Bank of England plans to prevent future property booms

The Bank of England's Financial Policy Committee (FPC) on Monday proposed powers to address the capital which banks hold against real-estate assets, derivatives and bonds.

The Bank of England's Financial Policy Committee (FPC) on Monday proposed powers to address the capital which banks hold against real-estate assets, derivatives and bonds.

The FPC warned that British banks would be asked to hold extra capital to keep the financial system safe should they be judged they were too liberal with home loans that risk fuelling a future housing boom. Property booms and busts have been behind many of Britain's economic downturns over the past few decades.

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