On 27 March 2017 we set out details of the 2017 stress test scenarios for the seven major UK banks and building societies. The scenarios were agreed by the Financial Policy Committee (FPC) and Prudential Regulation Committee (PRC).
The 2017 stress test includes two stress scenarios. Alongside the annual cyclical scenario (ACS), we are, for the first time, running an additional biennial exploratory scenario (BES).
- The ACS incorporates a severe and synchronised UK and global macroeconomic and financial market stress, as well as an independent stress of misconduct costs.
- The BES will consider how the UK banking system evolves in an environment of weak global growth, persistently low interest rates, stagnant world trade and cross-border banking activity, increased competitive pressure on large banks from smaller banks and non-banks, and a continuation of costs related to misconduct. The test has a seven-year horizon to capture these long-term trends.
Neither the stress applied under the ACS nor BES is a forecast.
We have received banks’ initial stress testing submissions and is in the process of analysing the results. The full stress test results will be published alongside the Financial Stability Report at 07:00 hrs (GMT) on 28 November. No results for individual firms will be published prior to this date.