ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -There are several ways in which the Reserve Bank aims to reduce the likelihood of financial instability. One is by laying the foundation for low and stable inflation and sustainable economic growth, an environment that will generally be conducive to financial stability.

Detailed explanation-2: -The Prudential Regulation Committee (PRC) is responsible for the exercise of the Bank of England’s functions as the Prudential Regulation Authority (PRA). The PRA is the UK’s microprudential regulator for around 1, 500 banks, building societies, credit unions, insurers and major investment firms.

Detailed explanation-3: -Supervising and Regulating Financial Institutions and Activities. The Federal Reserve promotes the safety and soundness of individual financial institutions and monitors their impact on the financial system as a whole.

Detailed explanation-4: -The Bank of England’s Financial Policy Committee (FPC) identifies, monitors and takes action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system.