Fisher urges capital preparation

Banks should continue to build up the amount of collateral they have pre-approved for use in the Bank of England’s emergency liquidity scheme, top official Paul Fisher said yesterday. He said the Bank’s discount window facility now has about £265bn of collateral pre-approved, enabling the central bank to inject around £160bn of liquidity. “Although not a substitute for firms building up their own holdings of high quality liquid assets to a more satisfactory level, that represents a very substantial war chest of potential liquidity in the event of significant adverse shocks,” Fisher said.