On May 21, the Court of the Bank of England announced that it had ordered reviews of certain areas of the Bank’s performance with reference to the 2008 financial crisis:
- The provision of emergency liquidity assistance to certain UK banks in 2008;
- The Bank’s framework for providing liquidity to the banking system as a whole in 2008; and
- The forecasting capability of the Bank’s Monetary Policy Committee.
In its announcement of the reviews the Bank stated that it will concentrate on areas where the Bank had sole responsibility and on lessons to improve the way that the Bank operates. Accordingly, the reviews will not consider actions taken by the Financial Services Authority or HM Treasury, the other two tripartite authorities involved in regulation of financial institutions. It will also not address the initial stage of the crisis in 2007, as the Bank considers that the Treasury Committee’s January 2008 report on the collapse of Northern Rock in September 2007 established the relevant lessons for the Bank to be drawn from those events.
The review conclusions will be presented to the Court of the Bank of England in October 2012, with publication “soon after that”.
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