British homeowners are putting the U.K. banking system at risk by pumping up their mortgage debt to pre-crisis levels, according to Lord Adair Turner, chairman of the Financial Services Authority. In unveiling the FSA’s latest Prudential Risk Outlook, Turner warned that borrowers can run into trouble if they lose their jobs or rates rise, but also said the threat to the financial systems is currently small as banks try to protect themselves by requiring larger down payments and the demand for loans is low.
