Severe but plausible: Carney lauds Brexit stress tests for central banks

Stress tests conducted by the central bank show Britain's financial system would still have more than adequate capital to maintain lending in the face of multiple headwinds, said Carney

UK banks are prepared to withstand more than just Brexit, according to Bank of England Governor Mark Carney.

Stress tests conducted by the central bank show Britain’s financial system would still have more than adequate capital to maintain lending in the face of multiple headwinds, Carney said in a speech in New York on Friday. The bank has been “preparing for the worst” outcome to the U.K.’s negotiations, including improving liquidity, building capital buffers and planning for disruption to cross-border derivative contracts.

“We judge that the UK banking system has the capacity to absorb not only the consequences of a no-deal, no-transition