Banking: Quantitative Easing

Lord Davies of Oldham Excerpts

Monday 10th October 2011 Lords Chamber

[Lord Sassoon]

Yes, my Lords, I can absolutely give that assurance.

[Lord Davies of Oldham]

My Lords, the Minister will have appreciated the fact that two of the more challenging questions have come from his own side, from the noble Lords, Lord Lawson and Lord Newby, about the future of RBS. What preparations are the Government making for recapitalisation of RBS if that proves to be necessary?

[Lord Sassoon]

My Lords, it would be completely wrong in any circumstances to speculate on individual banks. The FSA, the Bank of England and the Treasury look at all sorts of scenarios in relation to banks and other systemically important parts of the financial system. As a result of the recapitalisation of the banks and the stringent stress tests which the FSA has conducted repeatedly, the UK banking system is well recognised by the credit rating agencies and by many other commentators and is in a relatively good situation. We now want to see stress tests carried out right across the European banking system as a matter of urgency to proper standards.