Confidence in the stability of the UK financial system over the next three years has increased, according to the results of a Bank of England survey.
The Systemic Risk Survey (H1) was conducted between April 22 and May 16, and the results were published today (July 11). They reveal respondents were more likely to judge themselves as being completely confident or very confident. They were less likely to judge themselves fairly confident.
The perceived probabilities of a high-impact event in the UK financial system over both the short and medium term have decreased. The percentage of respondents judging the probability of such an event to be high or very high over the short term decreased notably from 67 per cent in 2018 to 52 per cent.
The Bank of England said in a statement: “UK political risk remained the most cited risk to the UK financial system (mentioned by 93 per cent of respondents). But the proportion of respondents who cited this risk decreased for the first time since the 2017 H2 survey.
“UK political risk also remains, by a considerable margin, the most frequently cited number one source of risk (mentioned by 69 per cent of respondents).
“Geopolitical risk (62 per cent, unchanged) and cyber-attack (60 per cent) were the second and third most cited risks respectively.
“The proportion of respondents that cited cyber-attack decreased for the first time since the 2016 H2 survey.”
A slightly larger proportion of respondents cited either the risk of a global/overseas economic downturn or the risk of financial market disruption/dislocation than in the previous survey.