By BLOOMBERG

LONDON • British banks may have unanimously passed Bank of England (BoE) stress tests, but that clean bill of health came with concern about a messy Brexit, courtesy of governor Mark Carney.

The central bank told lenders to add another £6 billion (RM32.83 billion) to their capital buffers and may increase their requirements again next year because it’s worried that the combination of a no-deal Brexit without a transition period and a global recession could strangle the flow of credit to the economy. Lloyds Banking Group plc shares sank as the worst-case scenario highlighted the domestic-focused bank’s exposure to consumers.

Barclays plc and Royal Bank of Scotland Group plc were the weakest of the seven major UK banks in the exercise, although they weren’t ordered to raise additional capital or change their strategies in light of actions they’ve taken since the end of last year.

“The combination of a disorderly Brexit, a severe global recession and stressed misconduct costs could result in more severe conditions than in the stress test” and restrict lending, the central bank said yesterday. However, if Brexit were to occur with a healthier world economy and fewer fines, banks could continue to support the economy through Britain’s exit from the European Union, the BoE said.

It’s the first time all the banks have passed the tests with no need to strengthen their capital position.

The additional £6 billion of capital must be added due to an increase in the BoE’s counter-cyclical capital buffer to 1% from 0.5%.