EU FINANCIALS: BoE/PRE consulting on lifting leverage ratio requirement

The BoE/PRA have launched a consultation on whether to increase deposit amount required to be subject to its leverage requirement to £70bn from £50 - in line with nominal GDP growth.

Above the threshold banks are subject to the min leverage ratio of 3.25% plus 2 additional buffers and are subject to additional reporting requirements. Below the threshold the 3.25% minimum still applies but there are no additional buffers and less disclosure requirements.

This is potentially particularly helpful for COVBS/LEED - building societies close to £50bn in deposits and that are typically more leverage constrained. UK building societies tend to be more leverage constrained rather than capital constrained.

UK Smaller banks - Total deposit amounts - £ bn/as per bbg

• LLOYDS        445
• VMUKLN        69
• COVBS        49
• YBS                48
• TSBLN        35
• SKIPTN        29
• MTROLN        22
• LEED                22
• INVPLN        21
• COOPBK        19
• PRINBS        9
• CBGLN        9

https://www.bankofengland.co.uk/prudential-regulation/publication/2025/march/leverage-ratio-changes-to-the-retail-deposits-threshold-consultation-paper