Britain's banks face a financial black hole of up to £60bn from regulatory demands, hidden losses, and potential mis-selling costs that threaten to jeopardise future growth, the Bank of England has warned.
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. Sir Mervyn King, the Bank's Governor, said the potential losses distorted the "picture of banks' health" and that lenders may have to "raise capital or take steps to restructure", the Daily Telegraph reports. As reported by IFAonline's sister title Investment We...
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