UK household indebtedness is high (a)(b)(c)(d) by historical standards Household debt to income ratio (of which mortgages)  Probability  Household debt to income ratio (excluding mortgages)  Total household debt to income ratio  Per cent of income 160 140  120 100 80 60  Annual GDP Growth  40 20 0 1987 87  Sources: ONS and Bank of England. (a) Distribution in each quarter is derived from quantile regressions of Real GDP growth on composite measures of real economy leverage and asset prices. Methodology follows quite closely that of Adrian et al (2016), ‘Vulnerable Growth’. 91  95  99  03  07  11  15  Sources: ONS and Bank calculations. (a) Total household debt to income ratio is calculated as gross debt as a percentage of a four-quarter moving sum of gross disposable income of the UK household and non-profit sector. Includes all liabilities of the household sector except for unfunded pension liabilities and financial derivatives of the non-profit sector. (b) Mortgage debt to income is calculated as total debt secured on dwellings as a percentage of a four-quarter moving sum of disposable income. (c) Non-mortgage debt is the residual of mortgage debt subtracted from total debt. (d) The household disposable income series is adjusted for FISIM and changes in pension entitlements. 18  All speeches are available online at www.bankofengland.co.uk/speeches  18  Chart 7. UK house price to household income (a)(b) ratio House price to household income  Chart 8.
We have also lengthened the supporting period and increased the IMF delinked portion, from 20% to 30% this year with a view to increasing it to 40% in 2014, subject to review should conditions warrant. In serving as a regional safety net, such arrangements contribute to further development of the regional financial markets by providing a credible liquidity firewall, both for crisis resolution and crisis prevention, to anchor investors’ confidence. It is only with  2  BIS central bankers’ speeches  enough confidence that we can attract the participation of foreign investors into our markets for the sustainable developments of our economies and region. I look forward to an even greater success in the next 10 years. Thank you for your kind attention. BIS central bankers’ speeches  3