BoE's Carney: Higher leverage ratio would mean a more resilient banking sector

Testifying before Parliament on the June financial stability report, BoE governor Mark Carney says that a potential higher leverage ratio would have the most marked effect on building societies and investment

• The leverage ratio is not a backstop but an integral part of bank capital framework, Carney insists.

• When addressing the MP's concerns about the introduction of a time-varying leverage ratio, external member of the Financial Policy Committee Donald Kohn suggests that it's a better solution to adjust the ratio depending on macroeconomic conditions, instead of keeping it flat.

• Higher leverage ratio shouldn't compel banks to hold riskier assets, Martin Taylor adds.

• Mark Carney rejects the idea that the Monetary Policy Committee and Financial Policy Committee should be merged.