The UK has recently put in place an explicit macro-prudential regime. In July of last year, the UK government announced a new Financial Policy Committee (FPC) to execute macro-prudential policy.7 The FPC is housed in the Bank of England and met for the first time in June this year. The FPC’s objective is to protect and enhance the resilience of the UK financial system against risks including “unsustainable levels of leverage, debt or credit growth”. Therein lies a key FPC challenge. There is evidence of unsustainably high levels of leverage in some sectors. But elsewhere, there is evidence of credit growth being unsustainably low. Some companies remain over-leveraged. Yet others are suffering a credit shortage, with bank lending to companies continuing to contract over the past 12 months. 5  For example, Graham and Narasimhan (2004), Malmendier and Nagel (2011). 6  For example, Cogley and Sargent (2008), Barro (2006). 7  HM Treasury (2010). BIS central bankers’ speeches  5  In framing macro-prudential policy today, both these factors need to be weighed: on the one hand, enhancements to the risk-bearing capacity of the financial system to repair balance sheets; on the other, encouragement for the risk-taking capacity of the system to boost credit supply. These factors can sometimes point in subtly different directions. The first might point to higher buffers to boost banks’ risk-bearing capacity, while the second might point to lower buffers to boost their risk-taking capacity.
His work will now feature on another 2 billion works of art – our new £ notes. How did we decide? How did we arrive at Turner? As befits Turner, we took the process of selecting a new banknote character out of the black box and brought it into the sunlight. In December 2013, the Bank of England committed to making our character selection process much more open and transparent. First, the Banknote Character Advisory Committee was created and then decided the field of accomplishment. They chose visual arts, which had never before been properly displayed on a banknote. The Bank then invited the public to make nominations in this field. They proposed artists, sculptors, printmakers, designers, craftspeople, ceramicists, architects, fashion designers, photographers and filmmakers. Indeed, the response was exceptional. We received almost 30,000 individual suggestions, between them nominating 590 different eligible characters – demonstrating not only the depth of achievement of British art but also the public’s passion for it. This pool was handed to our expert Banknote Advisory Committee – John Akomfrah, Sir David Cannadine, Andrew Graham-Dixon, Sandy Nairne, Alice Rawsthorn, Baroness Lola Young, and, from the Bank, Deputy Governor Ben Broadbent and Chief Cashier Victoria Cleland. They used their considerable knowledge, supplemented with views from public focus groups, and whittled down to a shortlist of five characters. What were the criteria? 2  BIS central bankers’ speeches  First, an unquestioned contribution to the visual arts. Second, a wider contribution to British society. And third, an enduring influence.