The Bank of England (BoE) reported last week on six potential factors that could slow down Great Britain's macroeconomy. Following the subprime problems in the U.S., the bank highlighted its concerns on similar loans going unpaid as one of those factors, which could threaten the economy's overall growth.

"Those arranging [similar] loans may be less inclined to assess credit quality at origination if they bear little of the ultimate risk," the BoE wrote. "While market mechanisms exist to ensure that originators distributing risk remain exposed to some of the potential credit loss, the high levels of arrears in recent vintages of U.S. subprime mortgage lending raise questions about the effectiveness of those mechanisms."

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