Response to the remit and recommendations for the Financial Policy Committee: December 2020
The Financial Stability Report contains a further response from the Financial Policy Committee to HM Treasury's recommendation on the non-bank financial sector.
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In March, the Chancellor of the Exchequer wrote to the Governor of the Bank of England providing the remit and recommendations for the Financial Policy Committee (FPC). The Committee responded to this in June.
In the letter, the government recommended that the FPC publish a more detailed assessment of the oversight and mitigation of systemic risks from the non-bank financial sector by end 2020. The Financial Stability Report contains a further response from the FPC to this recommendation on page 7, setting out the reasons why the FPC intends to publish this assessment in the first half of 2021 (as required by the Bank of England Act 1998). This response has been published by HM Treasury in accordance with the act.
The publication in the first half of 2021 will follow the FPC’s preliminary findings that were published in the August Financial Stability Report.
Update:
The Bank have notified HM Treasury that the Committee has met this request through two publications on 13 July: the July 2021 Financial Stability Report (in particular, the section titled “In focus - the resilience of market-based finance”) and the supporting report titled “Assessing the resilience of market-based finance”, produced by Bank of England staff under the guidance of the Committee. These publications follow the FPC’s preliminary findings that were published in the August 2020 Financial Stability Report.
This notification has been published by HM Treasury and laid before Parliament in accordance with section 9E of the Bank of England Act 1998.