The Bank of England is the UK's central bank. We are owned by the Government but set monetary policy independently. Our mission is to deliver monetary and financial stability for the British people.
Our main responsibilities are:
Issuing banknotes and managing the UK’s currency
Only the Bank of England can issue banknotes in England and Wales. Several banks in Scotland and Northern Ireland can also issue notes, and we monitor this process.
Our monetary stability objective is to deliver stable prices and confidence in the UK’s currency. Our Monetary Policy Committee (MPC) aims to achieve this by setting interest rates with the goal of reaching the Government’s 2% inflation target.
The Bank of England also has responsibility for UK financial stability – in other words, making sure that the system runs smoothly and that people can trust financial institutions.
Our Financial Policy Committee (FPC) looks out for and works to remove or reduce risks and weaknesses in the UK financial system. The Bank’s Prudential Regulation Authority (PRA) regulates and supervises roughly 1,700 banks, building societies, credit unions, insurers and investment firms to ensure that they are run safely.
We also have the following financial stability responsibilities:
- We regulate and oversee key payment systems, such as CHAPS and Bacs, which transfer money between banks.
- We act as lender of last resort, meaning that we can offer loans to financial institutions which are in serious difficulty or near collapse.
- We act as market maker of last resort at times of financial stress, meaning that we may buy and sell assets to provide liquidity to the markets.
- We can intervene to manage failing financial firms, to make sure that the effect on the economy is minimised.
In March 2014, we launched our three-year Strategic Plan to transform the way we work. The plan established a renewed mission for the Bank: ‘promoting the good of the people of the United Kingdom by maintaining monetary and financial stability’.
At the heart of the Strategic Plan is a commitment to build One Bank, which recognises the importance of having responsibility for microprudential supervision, macroprudential policy and monetary policy within the same organisation. It means that the Bank is better placed to deliver key economic benefits: stable inflation, economic growth, and the continuous provision of financial services. One Bank means a strong common culture, built from the best of all parts of the Bank, which brings together the whole of the organisation to better support each policymaker and every policy decision.
. Strategic Plan: Background information
See the Strategic Plan news release