Fears rise over 'high-impact' financial event, says Bank of England
Nearly 90% of financial firms think the chance of a "high-impact" event happening in the next year - such as the collapse of the euro - has increased in the last six months, the Bank of England said today.
The likelihood of such an event - which could also include a credit rating downgrade for the UK or a Government debt default - happening in the short term is at the highest level since 2008, the Bank's survey said.
Elsewhere, the poll found that 59% of its respondents, which include banks, hedge funds and building societies, are less confident than in the first six months of the year.
The threat of the eurozone debt crisis was the most commonly cited risk, with the economic downturn, funding risks and risks around regulation and taxes also in the top five.
The Bank conducts the survey, which launched in 2008 in the grips of recession, to monitor financial stability in the UK and to identify risks posed to the sector.
Nearly 70% of participants thought the chance of a high-impact event occurring in the medium term - that is one to three years - had increased.
Some 76% of respondents flagged sovereign debt risk as the biggest threat, while 76% also raised the risk of economic downturn as a serious problem.
Elsewhere, a couple of respondents said a financial transaction tax - or Tobin tax - was a risk to financial stability.
PA
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