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UK government tells BoE to focus more on global banking competitiveness

Published 09/12/2022, 08:11
Updated 09/12/2022, 08:41
© Reuters. FILE PHOTO: The Bank of England is seen against a blue sky, London  June 15, 2012. REUTERS/Paul Hackett

© Reuters. FILE PHOTO: The Bank of England is seen against a blue sky, London June 15, 2012. REUTERS/Paul Hackett

By David Milliken

LONDON (Reuters) - Britain's government said on Friday that it plans to change the law to require the Bank of England's Prudential (LON:PRU) Regulation Authority (PRA) to focus more on the financial sector's global competitiveness, as part of wider-ranging reforms.

The PRA, which regulates British banks and insurers, already has a duty to promote financial services competition, but this will be widened to cover "the international competitiveness of the UK economy - including in particular the financial services sector - and its growth in the medium to long term".

The new requirement - set out by finance minister Jeremy Hunt in a letter to BoE Governor Andrew Bailey - is "subject to aligning with relevant international standards".

Bailey has repeatedly said that effective regulation, ensuring financial stability, is essential for Britain to be attractive to foreign investors.

© Reuters. FILE PHOTO: The Bank of England is seen against a blue sky, London  June 15, 2012. REUTERS/Paul Hackett

Asked about the proposals, a BoE spokesperson said: "We look forward to working with HMT (Treasury)... and will continue to maintain a safe and sound financial system which supports the UK's position as a major global financial centre."

Other plans include a consultation in the coming weeks on a central bank digital currency - a project that Prime Minister Rishi Sunak was keen to explore during his time as a finance minister.

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