The Bank of England has warned that British high street banks risk losing as much as £30bn from defaults on credit cards and personal loans credit were the economy to take a turn for the worst.

The Old Lady of Threadneedle Street cautioned that the UK's growing £200bn consumer debt pile threatens some to damage the capital positions of some of Britain's biggest banks should a sharp downturn in the economy take place.

In a sombre statement from the central bank's Financial Policy Committee, the burgeoning consumer credit market was described as a "pocket of risk."

Although the Bank, led by Governor Mark Carney, asserted that rising consumer debt defaults would be unlikely to materially damage economic growth, it did warn that they would not be without cost.

Britain's banks need to set aside an extra £10bn to cover possible lossess on personal loans, credit cards and car loans, the Bank confirmed.

The share prices of some of the UK's biggest banks fell on the warning, with shares in Lloyds Banking Group and Barclays down by more than 1pc respectively in mid-morning trading.