Journal of the Banking Supervisor No. 64

The Importance of Banking During the COVID-19 Crisis

More than a year after SARS-CoV-2 was declared a global pandemic, the global economic outlook remains uncertain. Even when the world economy seems to be geared towards a recovery, projections are below pre-pandemic levels for a long-time horizon and are subject to various risks.

On the one hand, the effects and duration of the pandemic depends to a large extent on progress in vaccination processes around the world and on its effectiveness in the face of new strains of the virus. On the other hand, recovery expectations can be compromised if financial policies fail to lay the groundwork for strong long-term growth and development.

In addition, the region’s regulatory and supervisory authorities also note some particular risks for the financial systems, including an increase in the overdue portfolio of credits granted to SMEs and individuals as a result of lower sales, higher unemployment and losses in real income. It is expected that, with the deadline of payment deferral programmes, 2021 will show the actual delinquency effect of those accredited, which may imply significant restrictions on the supply of credits in certain countries. In any case, those who establish public policy play a crucial role in containing and mitigating potential impacts.

In this context, the Bank Supervisor Journal No. 64 presents a set of documents that may be useful to regulators and supervisors. The first section highlights some recent guidelines and principles issued by international agencies on operational and climate change risks. On the other hand, the market perspectives section includes some texts on the global and region economic outlook.

Additionally, the research and analysis section include documents on the impact of covid-19 on the financial sector, on the use of financial technologies, climate change risks and other documents recently published by ASBA’s associate members regarding capital requirement calculation methodologies and a set of supervisory tools for correspondent banking relationships.

Finally, in the last section associate members share news and information on prudential and non-prudential financial regulation issued in their jurisdictions during the first quarter of the year. This compilation is an effort to expand communication and understanding among the countries of the Americas on the approaches used to address various issues that are of joint interest in financial regulation.

Categories: Journal of the Banking Supervisor
Author: ASBA