Bank of England Expresses Little Faith in Europe

The Bank of England has issued its regular stability report, in which it warns that the European debt crisis is a "key risk" to the UK's banking sector.

It warns that British banks' exposure to other European lenders is making them vulnerable and, as such, British banks should build up their cash reserves.

In other words, the Bank of England believes that there is going to be at least one major default by either a major European bank or sovereign debt default (most likely Greece).

Baton down the hatches, it's going to be a long hot summer!