In its Financial Stability Report (FSR), the Bank revealed that the big four lenders – RBS, Lloyds, Barclays and HSBC – may need to take £15bn of extra provisions on consumer loans and European debt, “a further £4bn-£10bn” to cover fines and customer compensation, and “between £5bn and £35bn” to meet regulatory risk standards.
You can\’t raise capital requirements and also at the same time get the banks lending to support the economy.
This is simply one of those either or things.
You want to make them safer? Fine, do so: but the cost will be lower lending.
You want more lending? Fine: but you\’ve got to be more forgiving on capital levels if you do.