The Chancellor cut the maximum authorised size of the Asset Purchase Facility (APF), the Bank of England’s portfolio of UK government bonds (gilts), by £42.5bn to £482.4bn from £524.9bn, the Treasury said on Tuesday.
The new ceiling matches holdings on 4 November. Of the total, £362.4bn is authorised for monetary policy purposes and £120bn for indirectly backing current and future banknote issuance.
Andrew Bailey, Governor of the Bank of England, told John Healey, Chancellor of the Exchequer: “I can confirm that the stock of APF gilt holdings, as of 4 November 2026, was £482.4 billion.”
Holdings are £412.5bn below the January 2022 peak of £894.9bn, a 46% reduction, Healey said in his reply.
The ceiling is reset every six months under a 2022 agreement, and HM Treasury has indemnified the facility’s activities since it was set up in 2009.
The previous reset, on 5 May, lowered the limit from £555.0bn, set on 11 November 2025, to £524.9bn.
The Bank Executive intends to carry out the Monetary Policy Committee’s (MPC) multi-year plan through sales to the Government rather than to the market. That approach remains subject to final agreement with HM Treasury.
Healey said Bank and Treasury officials are developing a model in which all active APF gilt sales go to the government. Progress will be reviewed before April 2027, and implementation could be built into the Debt Management Office’s (DMO) annual financing remit.
The Bank said it will announce the operational details of the plan by April 2027, whatever the final decision.
The MPC has set an annual sales pace of £20bn in purchase proceeds terms until gilts held for monetary policy are fully unwound by the end of 2034. Allowing for maturities, that equals an average annual stock reduction of £46bn.
The Bank will not sell gilts with redemption dates earlier than 2035. A further £120bn of the longest-dated gilts will stay in the APF to back banknote issuance.
In September 2025 the MPC voted to cut the APF’s gilt stock by £70bn over the 12 months from October 2025 to September 2026, through sales and maturities. By 29 April the stock held for monetary policy had fallen by £33.2bn since October 2025.
Healey said he welcomed that the APF is being unwound “in a way that maximises value for money by minimising cost and risk over the lifetime of the APF”, subject to the MPC’s objectives. Any future cash transfers will be handled under the terms of the indemnity, as they have been to date.
The ceiling will be reviewed and confirmed again in six months, alongside the relevant APF Quarterly Report. Healey copied his reply to the chairs of the Treasury Committee and the Public Accounts Committee.
