07-06-2016, 12:07 AM
Here are the key risks the vote for a British exit from the EU, or Brexit, poses to financial stability, as per the BOE: Financing of the UK's large current account deficit, which relied on continuing material inflows of portfolio and foreign direct investment; The UK commercial real estate (CRE) market, which had experienced particularly strong inflows of capital from overseas and where valuations in some segments of the market had become stretched; The high level of UK household indebtedness, the vulnerability to higher unemployment and borrowing costs of the capacity of some households to service debts, and the potential for buy-to-let investors to behave procyclically, amplifying movements in the housing market; Subdued growth in the global economy, including the euro area, which could be exacerbated by a prolonged period of heightened uncertainty; and Fragilities in financial market functioning, which could be tested during a period of elevated market activity and volatility. It is not hard to see how many of this risks are "crystalizing" into realities. On the current account deficit, the pound has fallen to a 30-year-low against the dollar and Britain's credit rating has been marked down, making it more expensive to borrow.
Bank of England's July Financial Stability Report post-Brexit vote - Business Insider
A gigantic property fund is stopping people taking money out for the first time since the credit crisis of 2008. Savings and investment giant Standard Life froze investor withdrawals from its £2.9 billion ($3.8 billion) UK real estate fund after a flood of people tried to pull money out in the wake of the Brexit vote.
The race to succeed David Cameron as U.K. prime minister effectively became a proxy for the broader battle over how to manage withdrawal from the European Union, with Conservative Party candidates setting out their positions on what can be achieved and how fast. Pitches from all five candidates have focused on when Britain should trigger Article 50 of the Lisbon Treaty -- the formal start of two years of negotiations with the EU -- and what level of single-market access Britain should seek, as well as how much control it will have on migration and the fate of citizens of other EU countries who are already in the U.K. They have to appeal to party lawmakers and activists, many of whom want a full and rapid departure from the EU, while avoiding too many promises they’ll struggle to keep.
Brexit Strategies to Decide Race to Be Next U.K. Prime Minister - Bloomberg