Bank of England Weekly Report Shows Reserves Decline and Higher Repo Usage for Week to 16 September

Key Takeaways

• The Bank of England's weekly balance sheet for 16 September 2026 shows reserve balances down about GBP £3.6 Billion week over week, while short-term and indexed long-term repo lending increased.
• This is a routine data release rather than a new regulatory requirement, but it provides useful signals on sterling liquidity conditions and central bank operations for treasury, liquidity risk, and compliance teams.

Deep Dive

The Bank of England's weekly balance sheet for 16 September 2026 shows reserve balances down about GBP £3.6 Billion week over week, while short-term and indexed long-term repo lending increased. This is a routine data release rather than a new regulatory requirement, but it provides useful signals on sterling liquidity conditions and central bank operations for treasury, liquidity risk, and compliance teams.

Key movements for the week ending 16 September 2026, compared with 9 September 2026 (figures in GBP £ millions): Reserve balances fell from 641,563 to 638,012, a decrease of 3,551. Notes in circulation were broadly flat at 98,962 (up 30). Short-term repo rose from 123,656 to 124,141 (up 485), and indexed long-term repo rose from 84,353 to 84,919 (up 566). The Term Funding Scheme with additional incentives for SMEs declined slightly from 41,763 to 41,613 (down 150), consistent with scheduled repayments. Sterling bond holdings were essentially unchanged at 12,743. The Loan to Asset Purchase Facility was constant at 521,819. The contingent term repo facility showed no usage. On the foreign currency side, public securities issued rose to 21,190 from 20,885, while foreign currency reserve assets fell to 21,214 from 21,358.

The pattern of lower reserves alongside higher repo take-up is consistent with continued reliance on Bank facilities for sterling liquidity. Reserves remain large, so there is no sign of acute stress. Still, the steady drawdown of the Term Funding Scheme and the stable Asset Purchase Facility loan suggest balance sheet normalization is continuing. The absence of contingent term repo facility usage indicates no emergency liquidity demand during the period.

Recommended actions:

(1) Share the data with Treasury, ALM, and liquidity risk teams as an input to LCR and internal liquidity adequacy assessments.

(2) Confirm that the firm's use of Bank of England facilities and collateral positioning is consistent with its contingency funding plan.

(3) Monitor the trend in reserves over coming weeks for effects on funding costs and market liquidity.

(4) Firms with Term Funding Scheme exposure should verify that repayment schedules are on track.

(5) Note the Bank's reference materials on its weekly reporting regime for data interpretation.

Risk impact is low. Principal considerations are liquidity and funding risk, along with market risk from shifts in central bank balance sheet policy. No reporting changes or enforcement implications arise from this release.

Source: Bank of England