(Adds more detail, accounting rule)
LONDON, March 20 (Reuters) - The Bank of England said on
Friday it was cancelling this year's stress test of eight major
banks and building societies to enable them to focus on
providing lending through the coronavirus crisis.
The timetable for introducing the remaining Basel global
capital requirements for banks "may prove to be challenging" and
it would coordinate implementation with other countries, the BoE
said.
Scrapping this year's stress test follows a decision by the
European Union to cancel its planned health check of leading
banks, which had included top UK lenders.
"The recent 2019 stress test showed that the UK banking
system was resilient to deep simultaneous recessions in the UK
and global economies that are more severe overall than the
global financial crisis, combined with large falls in asset
prices and a separate stress of misconduct costs," the BoE said.
The BoE also said it was delaying other regulatory reports
on bank liquidity and climate risk, and a study into open-ended
investment funds to that banks can focus on dealing with fallout
from the coronavirus epidemic on their business and customers.
Banks have asked regulators for relief from a new accounting
rule know as IFRS 9 that forces them to begin recognising
potential losses on loans much earlier.
Britain is facing a sharp downturn which typically increases
the number of loans turning sour.
"The Bank continues to consider the potential interaction of
Covid-19 with IFRS 9.... and expects to provide further guidance
to firms regarding our approach next week," the BoE said.
The BoE also said it would postpone its joint survey with
the Financial Conduct Authority into open-ended funds.
(Reporting by David Milliken and Huw Jones; editing by Guy
Faulconbridge)