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How banks got away with the pandemic

The worst pandemic in a century, an event which has changed our whole way of life, appears to have dealt only a glancing blow to global banking. Good risk management certainly played a role; but, crucially, government support bailed out customers before they impacted bank balance sheets. Is there bad news to come when those policies go back to normal?

French Economy's 2020 Virus Slump Forecast To Exceed 10%
Photo: Getty Images

“I think we’re going to study this for years and years.”

James von Moltke, Deutsche Bank’s CFO, is responding to a question from Euromoney that we put to executives all over the world during their first half results. Why, we asked, has the banking sector come through so comparatively unscathed from a pandemic that has not only changed the world’s way of doing business but its way of life?

“For the nature of what we’ve lived through,” von Moltke agrees, “the credit cycle has been remarkably mild.”

There does appear to be a striking disconnect between the global impact of Covid-19 and the condition of the banking sector.


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Asia editor Euromoney
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Chris Wright is Asia editor. He covers the Asia Pacific region and is based in Singapore. He has previously been Middle East editor of Euromoney, editor of Asiamoney, investment editor of the Australian Financial Review and a correspondent on emerging markets and sovereign wealth for numerous publications worldwide. He has also written two books.