Bank of England warns Brexit remains 'material risk' to financial system

Consequences could be more severe than in stress tests

The Bank of England's Financial Policy Committee (FPC) has warned UK and European Union authorities are not doing enough to prevent the "material risks" of Brexit, which could potentially "disrupt the financial system directly".

The FPC said in its meeting on 12 March that both UK and EU politicians need to "tackle these [market] risks" as a priority. "Brexit could disrupt the financial system directly," the FPC said. "The combination of a disorderly Brexit and a severe global recession and stressed misconduct costs could result in more severe conditions than in the stress test." Brexit blog: OBR estimates Brexit divorce bill at £37bn Despite the warning, the FPC did say Brexit risks were yet to warrant additional capital buffers for the banking system. "The FPC continues to judge that, apart from those...