Question to the HM Treasury:

To ask Her Majesty’s Government what guidance they have given to the Bank of England in bringing forward curbs on leveraged lending.

On 26 November 2013, the Chancellor requested that the Financial Policy Committee (FPC) undertake a review of the leverage ratio and its role in the regulatory framework.

Treasury officials were consulted on the terms of reference for the review. The terms of reference were made publicly available on the Bank of England’s website.

On 31 October 2014, following almost a year of work and extensive consultation with stakeholders, the FPC published its response, the Review of the leverage ratio. The Review recommended that the FPC be given new powers of direction over the leverage ratio framework for the UK banking sector.

The Government has brought forward a statutory instrument to grant the FPC these powers.