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[/vc_column_text][vc_column_text]The sudden outbreak of the COVID-19, the novel coronavirus pandemic has led to a severe lockdown. The sudden shutdown of the multiple industries and businesses has threatened and disrupted the global economy and financial markets. COVID-19 has ushered in a recession after more than a decade of stable economic growth. The world economy is poised to lose trillions of dollars of losses in GDP due to the outbreak. 

The sudden advent of the unforeseen events could lead to certain uncertainties surrounding trade and commerce, manufacturing, services and global demand and supply as a whole. The travel & tourism industry has been especially battered as people are being told on limiting contact to check the spread of the profoundly infectious COVID-19 respiratory disease. The banking sector is a mirror of the whole economy. And banking is expected to bleed massively as all clients- corporates to small businesses struggle to survive. 

8 Low-Risk Loan Portfolio Strategies For Banks In The Coronavirus Environment

The monetary and fiscal policies are not designed in such a way that it can offset the disruptions caused by a sudden pandemic on the economy. Governments and policymakers around the world in the United States, Europe, and Asia are taking certain measures to offset the impacts caused by the pandemic by slashing interest rates but still this cutting down of interest rates cannot boost spending on the part of the quarantined people or restart operations of shutdown factories or businesses. [/vc_column_text][vc_single_image image=”11036″ img_size=”large” alignment=”center”][vc_column_text]The governments are enforcing proven public health measures such as social distancing in order to physically disrupt the contagion. Their measures have in turn severed the flow of people as well as goods and stalled economies. The entire financial ecosystem, banks, businesses, industries, etc. are facing the brunt of the pandemic. The COVID-19 outbreak has pushed down economies around the globe in a deep trench. The head of the International Monetary Fund declared that “it is clear that the global economy has now entered a recession that could be as bad or worse than the 2009 downturn”. [/vc_column_text][vc_row_inner][vc_column_inner][vc_column_text]The Fed has been extremely aggressive and pro-active. The Congress has passed the historic $2.3 trillion rescue package to directly support consumers and small businesses. $349 billion of it is through the innovative Payroll Protection Program for small businesses

Despite all the support from the government and the Federal Reserve, these are tumultuous times and banks need to make sure they are on the right side of the history this time around. The following points should help banks survive the crisis and emerge stronger: 

Predictions are that this pandemic-induced recession will cause more economic pain than the 2008 global crisis and the after-effects will continue to linger on for a longer period than it was earlier being estimated. Questions also arise on the fact that how long will it take for businesses as well as consumers to bring back their confidence and recover from the crisis. Certain policy measures undertaken globally by the governments, central banking authorities and finance ministries in this respect will be helpful but not too much extent, especially in the short term. The recovery of the economy will take time. Banks that had invested in digital, had adequate liquidity and most importantly were able to efficiently able to manage the trifecta of borrowers, staff and regulators will be the big winners of the COVID-19 crisis. [/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row][vc_column width=”1/2″][vc_custom_heading text=”Request MonJa’s Paycheck Protection Program Software Demo” font_container=”tag:h5|font_size:20|text_align:left” google_fonts=”font_family:Raleway%3A100%2C200%2C300%2Cregular%2C500%2C600%2C700%2C800%2C900|font_style:700%20bold%20regular%3A700%3Anormal”][vc_custom_heading text=”Software is designed for community banks to speed up the processing of Paycheck Protection Program Applications.” font_container=”tag:p|font_size:15|text_align:left|color:%23000000″ google_fonts=”font_family:Raleway%3A100%2C200%2C300%2Cregular%2C500%2C600%2C700%2C800%2C900|font_style:700%20bold%20regular%3A700%3Anormal” css_animation=”bounceInUp”][/vc_column][vc_column width=”1/2″][vc_column_text][yikes-mailchimp form=”10″ submit=”Request Demo”][/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][/vc_column][/vc_row]

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