Perceived Risk of High-Impact Event Fell, BOE Survey Shows

The perceived probability of the U.K. financial system suffering a high-impact event fell in the second half from the first, according to the results of the Bank of England’s Systemic Risk Survey published today.

The chances of such an event are low, according to 34 percent of respondents, up from 23 percent in the first half, the BOE said in a report on its website. Twenty percent said the probability is high or very high, down 16 percentage points.

Confidence in the stability of the U.K. financial system also improved, with 16 percent saying they’re completely or very confident, up 3 points. Fourteen percent said they’re not very confident, down 8 points.

One in 10 of those surveyed said public anger or distrust of financial institutions was one of the most pressing risks facing the industry, with “the main concern around repercussions, in terms of financial penalties and reputational damage, from the Libor scandal,” according to the report.

Regulators are probing at least a dozen financial firms over allegations they colluded to manipulate the London interbank offered rate, the benchmark for $300 trillion of securities from mortgages to student loans.

The central bank surveyed 79 market participants at banks, asset managers, hedge funds and other large financial institutions, mostly executives responsible for firms’ risk-management activities, from Sept. 24 to Oct. 25.