Timely Discussion in the EP

11 March 2021 |

Designing exit strategy requires judgment, coordination among different institutions, and graduality. Restoring banks’ balance sheet transparency is a first-order objective. To this end, borrower relief measures should be phased out ahead of the other measures. Relaxation of loan classification and provisioning policies can be lifted in a second stage. The last one to be unwounded would be capital relief initiatives. To provide banks time and space of manoeuvre, exit strategies needs to be communicated in a clear and timely manner.
This paper was prepared by the Economic Governance Support Unit (EGOV) at the request of the Committee on Economic and Monetary Affairs (ECON).

Read more at the file below.