In the News
Co-Op Bank fails Bank of England stress test
When reading this article consider why the central bank (the Bank of England) has introduced stress tests for commercial banks. The stress test is one of the responses to the 2007 Global Financial Crisis - in effect it introduces a fire break into the banking system. Bank must have sufficient tier 1 capital reserves in case there is another crisis and the rate of bad debts climbs higher. The troubled Co-Op must reduce the size of their loan book as part of the stress test procedure.