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Banking

Coronavirus crisis ramps up pressure on Poland’s banks

‘Inadequate’ stimulus package could leave banks on the hook as Covid-19 pushes Poland towards recession.

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Poland’s banks are bracing for an unprecedented shock as the Covid-19 crisis pushes the country towards its first recession for nearly 30 years.

Analysts at Raiffeisen Bank International (RBI) are predicting that the economy, which expanded by 4.1% in 2019, will contract by 2% this year after Poland went into lockdown on March 11.

To mitigate the effects of Covid-19, the Polish government announced on March 18 a stimulus package purportedly worth Zl212 billion ($49.9 billion).

In practice, this includes limited support for Polish businesses.

Liquidity measures previously announced by the central bank, including Poland’s first quantitative easing programme and a local version of the targeted longer-term refinancing operation (TLTRO), accounted for a third of the headline number.




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