BoE's Tucker confident lending scheme will help UK
TOKYO (Reuters) - Bank of England Deputy Governor Paul Tucker said on Friday that he was confident the central bank's new scheme to boost bank lending would help lower interest rates faced by businesses and households.
Speaking at a banking conference in Tokyo organised by the Institute for International Finance, Tucker said he had been "pleasantly surprised" by the number of banks and building societies that had signed up to the BoE's Funding for Lending Scheme (FLS) since it launched in early August.
"We observe the fall in funding costs that this has helped to bring about. I am reasonably confident this will be passed on to the real economy over time," he said.
If the FLS is a success, some Bank policymakers have said it would reduce the need for it to buy further government bonds under its quantitative easing scheme.
"There are no silver bullets," Tucker said. "Of course there is weak demand for credit but where we can remove impediments to the supply of credit we should do so."
Tucker also said that simple rules for bank regulation - as advocated by his Bank colleague Andrew Haldane - may not be enough to stop risky behaviour.
(Reporting by David Milliken; Editing by Chris Gallagher)
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