Bank of England
|Bank of England|
The Bank of England was founded in 1694 to act as the government's banker and debt manager. Since then, its role has developed and evolved, centered on the management of the nation's currency and its position at the center of the UK's financial system.
The Bank of England is the central bank of the United Kingdom. Sometimes known as the "Old Lady of Threadneedle Street," the Bank was nationalized on March 1, 1946, and gained independence in 1997. Standing at the center of the UK financial system, the Bank is committed to promoting and maintaining monetary and financial stability as its contribution to a healthy economy.
The Royal Charter was sealed on 27th July 1694. The Bank started life as the government's banker and debt manager, with 17 clerks and two gatekeepers. In 1734, the Bank moved to Thread-Needle Street, gradually acquiring land and premises to create the site as it is today.
Following an announcement in February of 2010 that CPI inflation in the 12 months to January was 3.5 percent, the Bank Of England published a letter on its Web site from the Governor to the Chancellor. The Chancellor's response was also included on the page.
The Bank of England's remit specifies that the Bank should explain why inflation has moved away from the target (more than one percentage point at this time), the period within which the Bank expects inflation to return to the target, the policy action that is being taken to deal with it, and how the approach meets the government's monetary policy objectives.
In July of 2012, The Bank of England’s Monetary Policy Committee voted to maintain the official bank rate paid on commercial bank reserves at 0.5 percent. The committee also voted to increase the size of its asset purchase program, financed by the issuance of central bank reserves, by £50 billion to a total of £375 billion.
Since 2013, the Bank has overseen four clearinghouses, operated by LCH, Intercontinental Exchange, CME Group and the London Metal Exchange. As chief regulator, it also had a role in assessing the London Stock Exchange Group’s proposed £20bn merger with Deutsche Boerse. The deal was later struck down by European regulators.  
More recently, the BoE and the Financial Conduct Authority addressed the slow transition away from the LIBOR rate, which is set to be retired at the end of 2021. The regulators said in a letter on March 26, 2021 that they were considering various ways to pressure firms that made insufficient progress or showing poor risk management related the change, including recommending cuts in bankers' bonuses. The FCA also said it plans to publish a synthetic London interbank offered rate for up to 10 years after the benchmark is abandoned. 
Coordinated Action With Federal Reserve
The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank in November of 2011 announced coordinated actions to enhance their capacity to provide liquidity support to the global financial system. The purpose of these actions was to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity.
The central banks agreed to lower the pricing on the existing temporary U.S. dollar liquidity swap arrangements by 50 basis points so that the new rate would be the U.S. dollar overnight index swap (OIS) rate plus 50 basis points. This pricing would be applied to all operations conducted from December 5, 2011. The authorization of these swap arrangements was extended to Feb. 1, 2013. In addition, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank would continue to offer three-month tenders until further notice.
As a contingency measure, the central banks agreed to establish temporary bilateral liquidity swap arrangements so that liquidity could be provided in each jurisdiction in any of their currencies should market conditions warrant the situation.
Structure and Governance
The BoE is governed by a Court of Directors, appointed by the Crown, comprised of nine non-executive directors, one is appointed by the Chancellor of the Exchequer to chair the court, and three governors. The Governors are appointed for periods of five years, and the Directors for three years. The Court's duties include: shaping strategy and objectives, managing the expenditure budget, conducting major capital projects, structuring the Bank's financial framework, assessing the Bank's risk management policies and managing the Bank's facilities in the money market.
Furthermore, the Bank delegates certain duties to three main committees.
- NedCo, also known as the Non-Executive Directors Committee NedCo has responsibilities for reviewing the Bank's performance in relation to its objectives and strategy, monitoring the extent to which its financial management objectives are met, reviewing the Bank's internal controls, and for determining the pay and terms of employment of the Governors, Executive Directors and external MPC members.
- Financial Stability Committee (FSC) is charged with: making recommendations to the Court of Directors, which they shall consider, about the nature and implementation of the Bank's strategy in relation to the financial stability objective, giving advice about whether and how the Bank should act in respect of an institution, where the issue appears to the Committee to be relevant to the financial stability objective, giving advice about whether and how the Bank should use stabilisation powers under the Banking Act 2009 in particular cases, monitoring the Bank's use of the stabilisation powers and monitoring the Bank's exercise of its functions under the interbank payment systems in the Banking Act 2009.
- Financial Policy Committee (FPC), created as an interim committee ahead of the formation of an official FPC, was brought about it 2011 to bring a, "new approach to financial regulation" for the Bank. The Committee oversees preparatory work and analysis in advance of the creation of the permanent FPC; monitors developments affecting financial stability in the United Kingdom and internationally, gives advice to the FSA and other bodies it feels appropriate about emerging risks in the financial system and recommend possible means of mitigating these risks; considers making recommendations to the Treasury about the regulatory perimeter and reviews and approve the Bank's Financial Stability Report which will set out its assessment and any recommendations that the Committee may have made. 
- Andrew Bailey, Governor
- Ben Broadbent, Deputy Governor of Monetary Policy
- Sir Jon Cunliffe, Deputy Governor of Financial Stability
- Sir Dave Ramsden, Deputy Governor, Markets & Banking
- Ben Stimson, Chief Operating Officer
- History. Bank of England.
- About The Bank. Bank of England.
- People & Biographies. Bank of England.
- History. Bank of England.
- News Release: Letter From The Governor To The Chancellor. Bank of England.
- Press Release. BOE.
- BoE told to firm up oversight of clearing and other support. The Financial Times.
- EU vetos Deutsche Boerse-London Stock Exchange merger deal. Reuters.
- BOE Threatens Banker Bonuses Over Pace of Libor Transition. Bloomberg.
- Press Release. FRB.
- BoE Structure. Bank of England.