Mark Carney tells MPs at Treasury committee that current house prices and mortgage approvals are not threat to financial stability

Governor of the Bank of England Mark Carney
Governor of the Bank of England Mark Carney said mortgage approvals and transactions were running at around three-quarters of pre-crisis levels. Photograph: Stefan Rousseau/PA
The Bank of England governor Mark Carney played down the threat of a UK housing bubble on Wednesday, arguing the housing market was playing catchup after the lows of the downturn.

Carney told MPs on the Treasury committee that at current levels rises in house prices and mortgage approvals were not a threat to financial stability.

"We've had an acceleration from quite a low level. Any time we see a sharp increase in credit growth we take an interest. We do have to put in some context though that it is still running below historic averages."

Carney said approvals and transactions were running at around three quarters of pre-crisis levels, and the Bank expected "a continuation of current momentum" in the market in 2014.

He added that the Bank was monitoring the impact of the government's Help to Buy scheme, but stressed it was modest in scale compared with the overall market.

Carney was giving evidence on November's Financial Stability Report alongside colleagues from the financial policy committee.

In a blow for Labour, the governor agreed with Andrew Tyrie, chairman of the Treasury committee, that "a crude cap" on bankers' bonuses was not a good idea.

Labour leader Ed Miliband has argued that RBS bankers' bonuses should be capped at 100% of their salary.

Carney also said that he was hoping to meet Alex Salmond during a planned visit to Scotland later this month, to discuss issues raised by the upcoming referendum on Scottish independence.


Comment: Mark Carney, was formally Canada's so called banking "superstar" as the Governor of the Bank of Canada during the 2008 meltdown. People were lead to believe that his sound "fiscal" policies saved the day. However, this was just not so, as a bankers robbery was in the making.