UK:
Bank Of England Publishes Guidance On Traded Risk Methodology For Stress Test Of UK Banking System Together With Traded Risk And Structured Finance Scenario
15 June 2015
Shearman & Sterling LLP
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On May 26, 2015, the Bank of England published a report on
stress testing the UK banking system, which includes guidance on
the traded risk methodology for participating banks and building
societies. The document sets out the approach that banks are
expected to take in the execution of the stress test of the UK
banking system relating to trading positions. The guidance is
designed to assist firms to carry out their own analysis for the
stress test. The BoE also published a traded risk and structured
finance scenario. This is a "tail risk" scenario,
designed to assess the resilience of banks to deterioration in
global economic conditions.
The report and scenario are available at: http://www.bankofengland.co.uk/financialstability/Documents/stresstesting/2015/tradedriskguidance.pdf
; and http://www.bankofengland.co.uk/financialstability/Documents/stresstesting/2015/tradedrisk2015.xlsx.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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