U.K. banks must reassess how quickly they could monetise their assets in the event of a crisis under new rules proposed by the Bank of England’s regulatory body, the Prudential Regulation Authority (PRA). The proposals are the first changes to the liquidity rules since these were updated in the aftermath of the 2008 financial crisis.
The changes are intended to ensure that all U.K. banks learn from the collapse of Silicon Valley Bank and the takeover of Credit Suisse in 2023. In particular, the focus is on the unprecedented speed at which these banking crises developed. The PRA explained in a press release that revised rules are necessary because of the significant advances in banking, payment, and communication technology over the past 18 years.
