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Flow of Funds (FoF)


Buildings in Canary Wharf on water front

Since the recent global financial crisis, the international community has had an increased focus on the analysis of financial stability, and the development of improvements to the data which support that analysis. This is particularly important for those countries, like the UK, which have a significant financial sector. Internationally, a key area for improvement is the development of whom-to-whom (w2w) time series data for financial transactions and balance sheets. Although sectoral data for the UK, that is, who holds what financial instrument (for example loans, shares, pensions and insurance)  by institutional sector, are already published, w2w data would show who holds whose financial instruments across the domestic sectors and the rest of the world.

This approach is encouraged by the International Monetary Fund in their work on the G-20 Data Gaps Initiative and the Special Data Dissemination Standard Plus (SDDS Plus). In addition, both the updated European System of Accounts manual (ESA 2010) and the 2015 Barker Review of the National Accounts (NSQR) recommend the implementation of w2w data into the National Accounts, which would provide flows between creditor and debtor sectors for each type of financial instrument. These data are essential for identifying the build-up of risks in the financial sector, and to understand financial connections amongst the institutional sectors and sub-sectors within the economy and with the rest of the world.

The Barker Review explicitly stated that in order to 'develop full Flow of Funds whom-to-whom accounts it is recommended that the ONS and the Bank of England establish a joint group to share data and expertise'.

In response to this recommendation, ONS and the Bank of England have set up a joint Flow of Funds (FoF) project.

Introduction to Flow of Funds

FoF for a given financial instrument measures financial flows across sectors of the economy and the rest of the world, tracking funds as they move from those sectors which provide funds, to those sectors which use those funds to acquire assets. It therefore presents information on debtor/creditor relationships and captures the changes in financial assets and liabilities in the economy.

FoF is based upon the principle that the movement of all funds must be accounted for. Therefore, in the economy, total sources of funds must equal total uses of funds and, financial asset transactions must equal transactions in liabilities.

A natural progression in the development of FoF accounts is to include w2w data, presented as time series. This can indicate the exposure of each individual sector to the risk which may build up in other sectors, and allows time series analysis. FoF on a w2w basis will act as a financial complement to the National Accounts and enable a deeper understanding of macro-economic behaviour.

Flow of Funds Project

Further progress, updates, articles and analysis on FoF will be published on this web page.

The minutes of the Financial Statistics Expert Group (FSEG) will also be published here. FSEG provides advice, guidance and quality assurance to ONS in the development of financial statistics. It therefore has a key role to play in the development of FoF.

The Flow of Funds team can be contacted by emailing:

Related articles

Release date Title
6 November 2015 The UK Flow of Funds Project: Comprehensive review of the UK Financial Accounts
13 July 2015 The UK Flow of Funds Project: introduction, progress and future work

Financial Statistics Expert Group meeting minutes

Full details of the Terms of Reference for Financial Statistics Expert Group (26 Kb Word document) are available.

Meeting date Minutes
22 July 2015  FSEG minutes 22 July 2015 (640.5 Kb Word document)
22 January 2015 FSEG minutes 22 January 2015 (2.8 Mb Word document)
21 October 2014 FSEG minutes 21 October 2014 (61 Kb Word document)  


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