REGULATION · UK
Bank of England explores relaxing mortgage lending caps amid housing pressure
The Bank of England is considering easing restrictions on high-risk mortgage lending. Historically, such policy shifts often trigger downstream changes to model risk governance and capital allocation frameworks.
WHY IT MATTERS
Loosening lending caps forces banks to recalibrate credit models and stress-test frameworks. Risk teams must prepare for higher portfolio volatility and recalibrate defaults—AI-driven credit models need retraining.
Source: Financial Times · 2026-10-31