TY  - UNPD
A1  - Boot, Arnoud
A1  - Carletti, Elena
A1  - Kotz, Hans-Helmut
A1  - Krahnen, Jan Pieter
A1  - Pelizzon, Loriana
A1  - Subrahmanyam, Marti G.
T1  - Corona and banking - A financial crisis in slow motion? An evaluation of the policy options
T2  - SAFE white paper ; No. 79
N2  - With the second wave of the Covid-19 pandemic in full swing, banks face a challenging environment. They will need to address disappointing results and adverse balance sheet restatements, the intensity of which depends on the evolution of the euro area economies. At the same time, vulnerable banks reinforce real economy deficiencies. The contribution of this paper is to provide a comparative assessment of the various policy responses to address a looming banking crisis. Such a crisis will fully materialize when non-performing assets drag down banks simultaneously, raising the specter of a full-blown systemic crisis. The policy responses available range from forbearance, recapitalization (with public or private resources), asset separation (bad banks, at national or EU level), to debt conversion schemes. We evaluate these responses according to a set of five criteria that define the efficacy of each. These responses are not mutually exclusive, in practice, as they have never been. They may also go hand in hand with other restructuring initiatives, including potential consolidation in the banking sector. Although we do not make a specific recommendation, we provide a framework for policymakers to guide them in their decision making.
T3  - SAFE white paper series - 79 
KW  - Bank Capitalization
KW  - Financial Crisis
KW  - Covid-19
KW  - Non-performing Loans
KW  - Asset Management Companies
KW  - Forbearance
Y1  - 2021
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/56878
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-568781
UR  - https://safe-frankfurt.de/de/policy-center/publikationen/detailsview/publicationname/corona-and-banking-a-financial-crisis-in-slow-motion-an-evaluation-of-the-policy-options.html
PB  - SAFE
CY  - Frankfurt am Main
ER  -