Treasury has ‘limited grasp’ of concerns over booming shadow banking sector, peers say

Report says officials seem unprepared for potential risks that unregulated industry poses to UK financial stability

The UK Treasury has a “limited grasp” of concerns linked to the booming shadow banking sector and may not be prepared for risks the unregulated industry poses to financial stability, peers have said.

While a lack of data makes it hard to say whether the $16tn (£12tn) non-bank financial sector could bring the wider financial system to its knees, officials do not seem to be alive to the potential risks, according to a Lords financial services regulation committee report.