Bank Liabilities Survey - 2015 Q4

This quarterly survey of banks and building societies is aimed at improving our understanding of the role of lenders’ liabilities and capital in driving credit and monetary conditions.
Published on 15 January 2016

The 2015 Q4 survey was conducted between 23 November and 11 December 2015.


  • UK banks and building societies reported that their total funding volumes had stayed broadly unchanged in the three months to mid-December 2015. Within the total, lenders reported that retail deposit funding had increased significantly, while ‘other’ funding, which includes wholesale debt funding and wholesale deposits, had fallen. Lenders expected total funding volumes to fall slightly in 2016 Q1.
  • Spreads — relative to appropriate reference rates — on ‘other’ funding were reported to have increased slightly in 2015 Q4, but the net percentage balance was much lower than in Q3 and spreads were expected to be broadly flat over the next three months. Lenders reported that spreads on retail deposits were unchanged, but expected them to fall in 2016 Q1.
  • Lenders reported that the supply of deposits from households and private non-financial corporations was up in 2015 Q4, but expected supply to remain flat next quarter. Lenders reported that regulatory drivers and, to a lesser extent, market share objectives were contributing positively to their demand for household deposits. A number of factors were also reported to be pushing up lenders’ demand for corporate deposits, with regulatory drivers and the relative cost of such funding the most significant factors.
  • The proportion of wholesale market funding accounted for by long-term instruments remained roughly unchanged in Q4, but lenders expect the proportion of long-term instruments in their funding structure to increase significantly next quarter. Price, non-price terms and regulatory drivers were the main factors expected to push up banks’ demand for long-term wholesale debt in Q1.


  • Lenders reported that their total capital levels increased in 2015 Q4 for the seventh consecutive quarter. Respondents expected their capital levels to remain flat next quarter.
  • Regulatory drivers were reported to have pushed up lenders’ demand for capital slightly in Q4, but the net percentage balance was much lower than in previous quarters. Strategic decisions to increase risk also pushed up lenders’ demand for capital slightly. Demand for capital instruments from investors was reported to have increased in Q4.

Transfer pricing

  • Lenders reported that the internal price charged to business units to fund the flow of new loans (the ‘transfer price’) increased further in 2015 Q4, driven by increases in wholesale funding spreads. Lenders expected the ‘transfer price’ to continue to rise over the coming quarter.
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