On 2 December 2025, the Bank of England (BoE) published the latest Financial Stability Report, which sets out the Financial Policy Committee’s (FPC) view on the stability of the UK financial system and what it is doing to remove or reduce any risks to it.
Key points highlighted in the report include:
- Risks to financial stability have increased during 2025 as global risks remain elevated as does uncertainty in the global macroeconomic outlook.
- Maintaining financial stability is essential to supporting sustainable economic growth over the long term, e.g. by lowering the cost of borrowing and improving incentives to invest.
- UK household and corporate debt remain low, but some groups remain more vulnerable to shocks than others.
- The UK banking system remains well capitalised and major UK banks continue to post robust earnings.
- Monitoring and improving the resilience of market-based finance is crucial to ensuring that the financial system can absorb shocks, rather than amplify them.
- Heightened geopolitical tensions and continued advances in technology have underlined the critical importance of operational resilience to the provision of vital services to households and businesses.
The FPC published its assessment of bank capital requirements and a record of the FPC’s meetings on 25 November and 1 December 2025 alongside the report.