LONDON: The Bank of England considered raising banks’ capital requirements last week by more than it had previously signalled to tackle risks to the financial system including those from Brexit, the BoE said on Tuesday. Britain’s banks have had to triple the capital they hold as a cushion against potential losses since the 2007-09 financial crisis which plunged the country into a recession, and the BoE is keen to ensure they are well-protected against future risks. Last week the BoE increased British banks’ counter-cyclical capital buffer to 1 percent from 0.5 percent. That was in line with a previous plan which aimed to ensure banks had enough capital at what the BoE sees as the mid-point of a lending cycle. However, a record of the BoE Financial Policy Committee’s meetings running up to the decision showed that they considered raising it higher. Annual stress tests of British banks last week showed that they could cope with a “disorderly” Brexit – but not if it coincided with a deep global recession and further significant fines for financial misconduct. “There were clear benefits to requiring banks to maintain additional capital,” the BoE said, summing up the case for raising the risk buffer above 1 percent. “On the other hand, the likelihood of a disorderly Brexit occurring in combination with both a severe global recession and very substantial additional conduct costs could be seen as extremely remote,” the BoE said. Published in Daily Times, December 6th 2017.