Q&A: Alastair Clark on the challenges facing the Bank of England's FPC

Power politics

It is the kind of decision that would give a supervisor sleepless nights: faced with a boom in mortgage lending to lower-income borrowers, should the market be shut down? On the one hand, products with a high loan-to-value (LTV) ratio are risky, giving a bank little security. On the other, home ownership can be a way for poorer families to climb the wealth ladder – introducing a political and social angle to what might otherwise be a prudential debate.

The UK’s embryonic macro-prudential regulat