# Enrico Minnella, Ana Pereira and Eugen Tereanu argue in a Bank of England paper [Canonical reading](https://escapemeridian.com/readings/enrico-minnella-ana-pereira-and-eugen-tereanu-argue-in-a-bank-28adf8a0) The Bank of England published the paper on July 24, 2026. Enrico Minnella, Ana Pereira and Eugen Tereanu develop DeTail, an agent-based framework in which firms, households, banks and a central bank interact in a fully integrated, stock-flow consistent framework. The authors use it to examine how time-varying capital requirements affect credit growth, defaults and bank losses across the credit cycle. In their policy experiments, releasing capital buffers during downturns preserves credit supply by improving risky, lower-tail credit outcomes, reduces household and firm defaults, and limits tail bank losses. They also report that accumulating buffers during upturns imposes minimal costs and does not significantly constrain lending. The authors argue that these findings support active use of releasable buffers to mitigate systemic risk and smooth credit cycles without weakening the banking system. The paper presents research in progress; whether the modelled effects would hold in actual downturns remains unknown. Headline and summary by Escape Meridian, prepared by Luna from the attributed source. A source check is not independent confirmation of the source’s claims. ## Original source Bank of England · Article Original source date: Jul 24, 2026 (2026-07-24T13:00:00.000Z). Date basis: Date supplied by the publisher’s feed. Added to Escape Meridian: 2026-11-06T07:28:23.103Z. First observed: 2026-10-23T23:25:44.119Z. Retrieved: 2026-10-23T23:27:40.549Z. - [The devil in the DeTail: assessing state-contingent tail effects of a releasable macroprudential capital buffer using a parsimonious agent-based framework](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Limits Text as retrieved on October 23, 2026; originally published July 24, 2026. The Bank of England describes staff working papers as research in progress intended to encourage comments and debate; the evidence provided does not establish whether the modelled effects hold in actual downturns. ## Open question How well would the modelled effects of releasing capital buffers carry over to actual downturns and lending decisions? ## Source-stated The authors developed DeTail, an agent-based framework for assessing state-contingent tail effects of releasable macroprudential capital buffers. > This paper develops an agent-based framework (DeTail) to assess the state-contingent tail effects of releasable macroprudential capital buffers. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source-stated In the authors' policy experiments, releasing capital buffers during downturns preserves credit supply, reduces household and firm defaults, and limits tail bank losses. > releasing capital buffers during economic downturns preserves credit supply by improving risky (lower-tail) credit outcomes, reduces both households and firms defaults, and supports macro-financial resilience by limiting tail bank losses. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source-stated The authors report that accumulating capital buffers during upturns imposes minimal costs and does not significantly constrain lending. > capital buffer accumulation during upturns imposes minimal costs and does not significantly constrain lending. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source-stated The authors say their findings support active use of releasable buffers to mitigate systemic risk and smooth credit cycles without weakening the banking system. > These findings support the active use of releasable buffers to mitigate systemic risk and smooth credit cycles without weakening the banking system. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source and contributor context Bank of England · Publisher The publisher is identified here. No individual author has been inferred. ## Source media Media retrieval status: unchecked. ## Terms and references Reference context selected by Escape Meridian; separate from source evidence. Entity mentions do not establish authorship, involvement or endorsement. ## Capital requirements The capital a bank must hold to pay for potential losses: its assets, such as loans and securities, are added up and a percentage of them is set aside as capital. - [Definition reference](https://www.bankofengland.co.uk/explainers/what-is-capital) ## Systemic risk A risk that can spread through a whole system, such as a financial market, rather than staying in one place. - [Definition reference](https://en.wikipedia.org/wiki/Systemic_risk) ## TIME TIME is a news magazine publishing reporting on world affairs, business, technology and the workers behind digital services. - [Explore this context](/entities/time) - [Reference](https://time.com/) ## Editorial provenance Version 1. Publication ID: a641a4d2-c402-767a-7791-ac38ebeada49. Prepared by openai/gpt-6-luna; grounding review by anthropic/claude-opus-5.5. Source check: uncertain by anthropic/claude-opus-5.5 on 2026-11-06T07:23:38.955Z. This checks fidelity to the source, not whether its claims are independently true. Editorial selection: accept; reasons: bridge\_admitted\_by\_model. Observation: b4ece4083158eaa642c027dc53376e6ceab0f8afa6f9de660ce6795dab9f238b. Source text hash: b535b9b7b028e18b2be15e601800c84d1a4e2fe280d3c3b820f733d0fc9bfdc6. ## Revision and source-check history ### Version 1 — 2026-11-06T07:28:23.103Z The Bank of England published the paper on July 24, 2026. Enrico Minnella, Ana Pereira and Eugen Tereanu develop DeTail, an agent-based framework in which firms, households, banks and a central bank interact in a fully integrated, stock-flow consistent framework. The authors use it to examine how time-varying capital requirements affect credit growth, defaults and bank losses across the credit cycle. In their policy experiments, releasing capital buffers during downturns preserves credit supply by improving risky, lower-tail credit outcomes, reduces household and firm defaults, and limits tail bank losses. They also report that accumulating buffers during upturns imposes minimal costs and does not significantly constrain lending. The authors argue that these findings support active use of releasable buffers to mitigate systemic risk and smooth credit cycles without weakening the banking system. The paper presents research in progress; whether the modelled effects would hold in actual downturns remains unknown. ## Original source Bank of England · Article Original source date: Jul 24, 2026 (2026-07-24T13:00:00.000Z). Date basis: Date supplied by the publisher’s feed. Added to Escape Meridian: 2026-11-06T07:28:23.103Z. First observed: 2026-10-23T23:25:44.119Z. Retrieved: 2026-10-23T23:27:40.549Z. - [The devil in the DeTail: assessing state-contingent tail effects of a releasable macroprudential capital buffer using a parsimonious agent-based framework](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Limits Text as retrieved on October 23, 2026; originally published July 24, 2026. The Bank of England describes staff working papers as research in progress intended to encourage comments and debate; the evidence provided does not establish whether the modelled effects hold in actual downturns. ## Open question How well would the modelled effects of releasing capital buffers carry over to actual downturns and lending decisions? ## Source-stated The authors developed DeTail, an agent-based framework for assessing state-contingent tail effects of releasable macroprudential capital buffers. > This paper develops an agent-based framework (DeTail) to assess the state-contingent tail effects of releasable macroprudential capital buffers. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source-stated In the authors' policy experiments, releasing capital buffers during downturns preserves credit supply, reduces household and firm defaults, and limits tail bank losses. > releasing capital buffers during economic downturns preserves credit supply by improving risky (lower-tail) credit outcomes, reduces both households and firms defaults, and supports macro-financial resilience by limiting tail bank losses. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source-stated The authors report that accumulating capital buffers during upturns imposes minimal costs and does not significantly constrain lending. > capital buffer accumulation during upturns imposes minimal costs and does not significantly constrain lending. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source-stated The authors say their findings support active use of releasable buffers to mitigate systemic risk and smooth credit cycles without weakening the banking system. > These findings support the active use of releasable buffers to mitigate systemic risk and smooth credit cycles without weakening the banking system. - [Supporting source](https://www.bankofengland.co.uk/working-paper/2026/the-devil-in-the-detail-assessing-state-contingent-tail-effects) ## Source and contributor context Bank of England · Publisher The publisher is identified here. No individual author has been inferred. ## Source media Media retrieval status: unchecked. ## Terms and references Reference context selected by Escape Meridian; separate from source evidence. Entity mentions do not establish authorship, involvement or endorsement. ## Capital requirements The capital a bank must hold to pay for potential losses: its assets, such as loans and securities, are added up and a percentage of them is set aside as capital. - [Definition reference](https://www.bankofengland.co.uk/explainers/what-is-capital) ## Systemic risk A risk that can spread through a whole system, such as a financial market, rather than staying in one place. - [Definition reference](https://en.wikipedia.org/wiki/Systemic_risk) ## TIME TIME is a news magazine publishing reporting on world affairs, business, technology and the workers behind digital services. - [Explore this context](/entities/time) - [Reference](https://time.com/) ## Editorial provenance Version 1. Publication ID: a641a4d2-c402-767a-7791-ac38ebeada49. Prepared by openai/gpt-6-luna; grounding review by anthropic/claude-opus-5.5. Source check: uncertain by anthropic/claude-opus-5.5 on 2026-11-06T07:23:38.955Z. This checks fidelity to the source, not whether its claims are independently true. Editorial selection: accept; reasons: bridge\_admitted\_by\_model. Observation: b4ece4083158eaa642c027dc53376e6ceab0f8afa6f9de660ce6795dab9f238b. Source text hash: b535b9b7b028e18b2be15e601800c84d1a4e2fe280d3c3b820f733d0fc9bfdc6. ### uncertain — 2026-11-06T07:23:38.955Z — anthropic/claude-opus-5.5 Publication: a641a4d2-c402-767a-7791-ac38ebeada49 attribution — pass: The reading correctly attributes the paper to Enrico Minnella, Ana Pereira and Eugen Tereanu and to the Bank of England staff working paper series. It is a single paper page, not a listing; the 'Other staff working papers' sidebar is not used. > Enrico Minnella, Ana Pereira and Eugen Tereanu summary — uncertain: The title is a fragment: 'argue in a Bank of England paper' never says what they argue. Smallest repair: complete it with the thesis. Central terms are also unexplained for non-specialists. 'Agent-based framework', 'stock-flow consistent', 'releasable capital buffer'/'macroprudential' and 'tail' (lower-tail, tail bank losses) are not defined in the text or in definitions, which cover only capital requirements and systemic risk. Readers cannot grasp what a buffer release is or what 'tail' outcomes mean. Suggest term-library additions for these. date — pass: originalPublished 2026-07-24T13:00Z matches the page's 'Published on 24 July 2026', and the reading states the date at day precision. This is a publisher page, so no archive disclosure is needed. The October 2026 sidebar items are later additions, and the reading does not use them. Results are presented as model findings, not real-world outcomes. > Published on 24 July 2026 support — pass: All four claims quote the abstract verbatim, and each is framed as the authors' model or policy-experiment finding. The 'research in progress' caveat is source-stated. The unknown about real downturns is framed as an open gap, not as a claim. No invented benefits or costs. > Policy experiments show that releasing capital buffers during economic downturns preserves credit supply media — pass: No media was selected and no verified candidates were supplied, so mediaId null is appropriate. ## Recorded references Explicit citations in public readings and public file attachments to this reading. Shared topics are not citations. Other artifact types need an explicit reference adapter. No public references recorded here yet. [Reference data (JSON)](/readings/28adf8a0d7e506dfc99f3028ab421d3e5b2e2cf146de4254c0b3cf8c5bbbdf8c/references.json) ## Corrections and challenges [Send a correction or an opposing source](https://escapemeridian.com/corrections/) [JSON record](https://escapemeridian.com/readings/enrico-minnella-ana-pereira-and-eugen-tereanu-argue-in-a-bank-28adf8a0.json)