- The BOE is known as "The Old Lady of Threadneedle Street". This stems from a political cartoon of 1797. The BOE was established in 1694 as a private bank to act as banker for the Government. It was essentially founded to fund King William III's war against France. Come 1797 France had declared war on Britain and the Prime Minister, William Pitt, wanted to stop the public converting bank notes to gold. Pitt was said to be trying to woo gold from the The Old Lady of Threadneedle Street. The name has stuck!
- Today the role of the BOE is to "promote the good of the people of the UK by maintaining monetary and financial stability." The BOE is not only a central bank, it's remit includes regulation and oversight. Following the financial crisis of 2007-2008 it was accepted that having a sound balance sheet does not necessarily mean good things for the consumer.
- What sits under the BOE umbrella:
- The Prudential Regulation Authority (PRA), is subsidiary of the BOE. In response to the financial crisis the Financial Services Act 2012 created the PRA as a new prudential regulator.
- The Financial Policy Committee (FPC), was created by the same Act and aims to reduce systemic risk.
- The Monetary Policy Committee (MPC), sets the BOE interest rate (the bank rate) and makes decisions on achieving the inflation target. The BOE are charged with keeping inflation at 2%.
- The BOE has Agents including an Agent for Scotland. The Bank Agents report to the BOE on business conditions across the country. To understand local economies the Bank Agents meet organisations in local areas including businesses and the third sector. The Bank Agents use these insights to brief the MPC ahead of their interest rate setting meeting.
- The BOE want to directly interact with the public. The BOE is actively looking at how they engage with the public. They have moved from an annual speech of 5000 words 70 years ago to issuing 4.5 million words in 2017. In a bid to improve public understanding and scrutiny, the BOE announced on 6 March 2018 their intention to set up citizens panels.
The Agency for Scotland is based in Glasgow and can be followed on Twitter @BoEScotland.