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Mark Carney confident about UK banks' Brexit readiness

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
Bank of England governor Mark Carney speaks at a news conference in London on Thursday. Photo: Kirsty O’Connor/Reuters

Bank of England governor Mark Carney said he is “quietly confident” about the level of preparation done by banks for Brexit.

“We feel quietly confident in the prep of the banks and financial institutions in the UK,” Carney said at a press conference on Thursday.

Carney made the comments during a Q&A on the Bank’s November interest rate decision and inflation report. The session was dominated with questions about Brexit after the Bank of England warned they may be forced to raise interest rates if there is a disorderly exit from the EU in March.

Carney stressed that this scenario is unlikely and the financial system is in good shape to deal with Brexit.

“They have adequate capital, they have more than adequate liquidity, they have contingency plans,” he said. “The outstanding issues largely relate to cross-border issues.”

Earlier on Thursday there were reports that the government is close to agreeing a deal with the EU on financial services. Carney declined to comment on this when asked.

He said the Bank will give more details on the banking sector’s level of preparedness at the end of the month when results from the latest stress tests are published.

“People, whether they’re going for a mortgage next month or next year, the banks will still be there,” Carney said.

The Bank left the headline interest rate unchanged at 0.75% on Thursday. It also kept its quantitative easing programme steady at £435 bn.