What a difference a year makes. Twelve months ago, Mark Carney reassured a nation going into political paralysis following the Brexit vote that the Bank of England (BoE) stood ready to flood the financial system with cash.
This week, the governor will re-examine whether it’s time to start taking back some of that bank support following rapid growth in consumer credit, a first step towards normalising policy in the UK.
As Carney prepares to deliver his biannual assessment of UK financial stability, he could force Britain’s biggest banks to raise the levels of capital they employ. 
Any increase would reverse actions taken in the immediate aftermath of Britons’ decision to leave the European Union, after which the BoE pumped liquidity into the banking system and announced a package of emergency measures to support growth.
“It is time for them to start removing some of the stimulus they put in on the macroprudential side,” said Philip Rush, chief economist at Heteronomics in London. 
“After the referendum, there were some signs of panic, but the consumer shrugged it off. Most metrics are suggesting things are back to normal.”
The BoE’s Financial Policy Committee – set up after the 2008 crisis – met last week and is scheduled to release its report on Tuesday. The governor will give a press conference, where questions about Brexit will probably dominate.
With consumer lending growing at an annual 10% pace amid hot competition among banks to sell credit cards and personal loans, UK regulators are reviewing lending standards. 
The pace of borrowing and level of debt may spur the FPC to revisit its decision to lower the so-called countercyclical capital buffer on banks’ UK exposures to zero taken after the referendum. Officials, who reassessed the level at this month’s meeting, have previously said they prefer it at 1% in normal times and that any changes would come into effect with a 12 month lag.
That level “was the path they were on prior to the referendum vote,” said Claire Kane, an analyst at Credit Suisse in London. 
She, along with Rush, predicts an increase to a 0.5% buffer on Tuesday and said the BoE “may work to moderate and to stem the growth in credit, particularly consumer credit.”
Questions may also be asked about the BoE’s Term Funding Scheme, a tool implemented by the Monetary Policy Committee, and whether drawdowns should be extended past the current February deadline. 
Analysts at Bank of America Merrill Lynch including Alastair Ryan and Michael Helsby have warned the programme has helped cause excessive competition among banks.
These exceptional levels of monetary assistance to the UK economy have helped boost lending with about £106bn ($135bn) in cheap term liquidity from the TFS and its predecessor, the Funding for Lending Scheme, according to analysts at UBS Group led by Jason Napier.
Removing that support would cut the supply of credit to the UK economy and reduce the risk of a bubble, should the BoE feel the nation can handle tighter conditions. 
Banks may increase lending rates to protect profit margins in response to a higher cost of funding.
“We, and I am sure all of the challengers, are planning for the TFS to finish next February,” Paragon Group chief executive officer Nigel Terrington said by e-mail. 
The rate banks pay depositors could increase as a consequence, although lending rates will probably be raised to maintain profitability margins, he added.