BOE May Ask Banks to Boost Capital Ahead of Brexit

The video discusses the recent stress tests where all UK banks passed for the first time in four years. However, the Bank of England is urging banks to increase their capital buffers due to potential risks from a disorderly Brexit. The countercyclical capital buffer is explained as a tool to ensure banks have higher reserves during good times, which can be released during downturns. The Bank of England has increased this buffer to 1% and plans further increases. The video also covers potential tightening in lending due to Brexit, economic crises, and misconduct costs, but notes that the banking system is more stable now than before the financial crisis.

What are the implications of the recent increase in capital buffers for lending in the UK?

What impact does the Bank of England believe the current capital levels will have on the banking system?