View more on these topics

BBA: Lenders must declare forbearance provisions, says BoE

It is crucial that supervisors are made aware of lenders’ provisions for potential losses being masked by forbearance measures, says Paul Tucker, deputy governor at the Bank of England.

Speaking at the British Bankers’ Association conference today, Tucker says it is not always bad for lenders to use forbearance measures, but they need to make provisions for any potential losses and declare these to supervisors.

He says supervisors need this information in order to assess capital adequacy requirements.

Referring to the Bank’s Financial Stability Report published earlier this week, which said forbearance could be masking the true number of mortgage borrowers in arrears, Tucker says the key question that remains unanswered is to what extent lenders are making provisions for forbearance losses.

He says: “It is legitimate for supervisors to take an interest in provision policy because you cannot access capital adequacy requirements without knowing the extent of lenders’ provisions.”
       

Recommended

Business development appointment at Brightstar

Brightstar Financial has appointed Terry Young as business development executive. Young joins from Compliance Checking where he was business development director.

Lenders come under FSA fire over fraud

The Financial Services Authority gave lenders a lashing last week over their anti-fraud systems as it published its long-awaited thematic review of lenders’ fraud prevention systems. Lenders were slammed for not engaging with the regulator’s Information From Lenders scheme to report suspected fraud and the idea of making it compulsory was floated. Underwriting teams were […]

Co-op issues second RMBS for £871m

The Co-operative Bank has launched its second securitisation which Moody’s estimates to be around £871.5m. The residential mortgage-backed securitisation follows its first RMBS last February, worth £2.5bn. Silk Road Finance Number Two is backed by a pool of prime UK residential mortgage loans originated by the former Britannia Building Society and Co-operative Bank under the […]

Thumbnail

DB transfer showstoppers

By Jim Grant, Senior Product Insight & Technical Support Analyst Transfers from defined benefit (DB) schemes are a bit of a hot topic just now. In this article we look at a couple of factors that could prevent a transfer from happening Equalisation of pensions Prior to the Barber case in 1990, DB pension schemes typically provided […]

Newsletter

News and expert analysis straight to your inbox

Sign up