BoE’s Tucker confident on new lending scheme
Speaking at a banking conference in Tokyo organised by the Institute for International Finance, Mr Tucker said he had been “pleasantly surprised” by the number of banks and building societies that had signed up to the BoE’s Funding for Lending Scheme (FLS) since it launched in early August.
“We observe the fall in funding costs that this has helped to bring about. I am reasonably confident this will be passed on to the real economy over time,” he said.
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Hide AdIf the FLS is a success, some BoE policymakers have said it would reduce the need for it to buy further government bonds under its quantitative easing scheme.
“There are no silver bullets,” said Mr Tucker. “Of course there is weak demand for credit but where we can remove impediments to the supply of credit we should do so.”
Mr Tucker also said that simple rules for bank regulation - as advocated by his BoE colleague Andrew Haldane - may not be enough to stop risky behaviour.