U.K. Treasury Refuses to Release Stress Tests on RBS, Lloyds Citing Stability

Discussion in 'Economics' started by ASusilovic, May 22, 2009.

  1. May 22 (Bloomberg) -- The U.K. refused to release the results of stress tests conducted on British banks, two weeks after the Federal Reserve said similar reviews showed 10 U.S. lenders needed to raise a total of $74.6 billion.

    Publishing the information may increase instability and force the government to take further action to shore up the U.K. financial system, the Treasury said in response to a Freedom of Information Act request by Bloomberg News that sought the test results and criteria used to evaluate banks. U.S regulators said publishing their findings would ease concerns about lenders.

    “Keeping the information under wraps will only serve to create more uncertainty in the long term,” Vince Cable, the opposition Liberal Democrats’ spokesman on treasury issues, said in an e-mailed statement. “We need a system that is as open and as transparent as that in the United States.”

    The Financial Services Authority carried out stress tests on U.K. banks earlier this year to determine their ability to withstand losses amid the worst recession in 60 years. Barclays Plc is the only bank to have disclosed its results, saying it will continue to meet the regulator’s capital requirements under various credit risk, market risk and economic scenarios.

    Disclosure of the results “at this time may lead to uncertainty in financial markets, either in relation to specific institutions or more generally,” the Treasury said in its response to Bloomberg. “Such instability could require further action by the authorities.”

    The same request to the FSA was rejected on the grounds it would be too costly to retrieve the documents. Lesley Richardson, an FSA freedom of information officer, said the results wouldn’t be released in any case because the information was confidential.

  2. Bloody toxic sludge pits they are, mate...
  3. Good reason to leave UK and say good bye to 50 % top tax rate.

    Still, I am confused about the strength of GBP or shall I say weakness of USD ? :D