Question to the HM Treasury:

To ask Her Majesty's Government what assessment they have made of the impact of ring-fencing on the pricing of risk in the UK residential mortgage market.

The Bank of England acknowledged, in its December 2019 Financial Stability Report, that there has been increased competition in the UK residential mortgage market, as reflected by the continued decline in interest rates for new mortgages. This report noted that the competition in the mortgage market may have been amplified by the introduction of ring-fencing regulation.

This year the Treasury will be appointing an independent panel to conduct a review of the operation of ring-fencing, as required by legislation. Based on the conclusions reached in its report, the review panel will make any necessary recommendations to the Treasury. This final report will then be published by the Treasury.