Home Finance No Evergrande fallout in Britain

No Evergrande fallout in Britain

Bank of England Governor Andrew Bailey said that resolving Chinese property developer Evergrande Group’s struggle with $300 billion in liabilities has been fairly protracted. But did not threaten financial stability in Britain. China was clearly trying to reduce its reliance on the property sector for growth. Also, Bailey told parliament’s Treasury Committee that the BoE was closely watching events at Evergrande.

He added that they are seeing contagion within China. But it seems to be being kept under control. They are managing it by effectively preferring onshore to offshore creditors. But it is a concern to them. Two banks in Britain, Standard Chartered and HSBC, have large exposures to east Asia. BoE Deputy Governor Jon Cunliffe said that Britain’s banks were resilient, holding enough capital to withstand another COVID-19. And that too without requiring government help.

Lawmakers also asked about the end of the use in Britain of London Interbank Offered Rate (Libor) for loans. This was one of the biggest changes in markets in decades. There is also concerns about financial stability risks. Bailey stated that he is very pleased with the way it has gone. While the demise of Libor in Britain has been smooth after six-and-a-half years of preparations, there was still work to do in whittling down the number outstanding contracts.

Previous articleBig Credit Suisse investor hopeful for bank’s turnaround
Next articleEuropean shares tumble in global selloff


Please enter your comment!
Please enter your name here