The impact of the COVID-19 pandemic on the German banking industry - a critical analysis of regulatory easing for banks

• Authors: Hastenteufel Jessica , Haag Anke , Eschenröder Maria
• Languages of publication: EN

Abstracts

EN

The COVID-19 pandemic was a challenge for all aspects of life. Besides others, this includes health and social life as well as the overall state of the economy. To contain the spread of the coronavirus, governments throughout the world imposed temporary closures (lockdowns). The banking industry was affected by these lockdowns in multiple ways. To mitigate the potential negative impact of the COVID-19 pandemic on banks, the national and international supervisory authorities passed comprehensive measures. The aim of this paper is to highlight the main regulatory facilitations for German banks by focusing on measures regarding capital buffers and the operating areas of banks. Besides this, an expert study was conducted to analyze how the measures are perceived by German banks and to develop recommendations for action. The results of the study show that the measures have mainly had a signaling effect on banks. However, measures like the easing of capital requirements are also related to higher risks for the banks. The results illustrate that most banks have hesitated in taking these additional risks if they can avoid them, with other measures like general moratoria on payments considered helpful. Overall, the results demonstrated that the experts prefer a cautious approach to using the easing measures.

Keywords

EN

COVID-19 pandemic; banking; banking supervision

• Publisher: Wydawnictwo AGH
• Journal: Managerial Economics
• Year: 2021
• Volume: 22
• Issue: 2
• Pages: 95-112

Dates

published

2021-2021

Contributors

author

Hastenteufel Jessica

• IU International University of Applied Sciences

author

Haag Anke

• TH Mittelhessen University of Applied Sciences

author

Eschenröder Maria

• Deutsche Bundesbank, Hauptverwaltung in Bayern

References

• Baumstark, N. and Mehring, S. (2020) ‘Stundungen im Kreditgeschäft: und ihre Folgen in Zeiten der Corona-Pandemie’, Zeitschrift für das gesamte Kreditwesen, vol. 73, pp. 10–14.
• BCBS (2020) Governors and Heads of Supervision announce deferral of Basel III implementation to increase operational capacity of banks and supervisors to respond to COVID-19 [Online], Available: https://www.bis.org/press/p200327.htm [7 Mar 2022].
• Bundesfinanzministerium (2020a) 50 Milliarden Euro Soforthilfen für kleine Unternehmen auf den Weg gebracht [Online], Available: https://www. bundesfinanzministerium.de/Content/DE/Pressemitteilungen/Finanzpolitik/2020/03/2020-03-23-pm-gemeinsame-PM.html [7 Mar 2022].
• Bundesfinanzministerium (2020b) Bundesregierung aktiviert Wirtschaftsstabilisierungsfonds – Massive Bundeshilfen zum Schutz von Unternehmen und Arbeitsplätzen [Online], Available: https://www.bundesfinanzministerium.de/Content/DE/Pressemitteilungen/Finanzpolitik/2020/03/2020-03-23-pm-Wirtschaftsstabilisierungsfond.html [7 Mar 2022].
• Bundesfinanzministerium (2020c) Kampf gegen Corona: Größtes Hilfspaket in der Geschichte Deutschlands [Online], Available: https://www.bundesfinanzministerium.de/Content/DE/Standardartikel/Themen/Schlaglichter/Corona-Schutzschild/2020-03-13-Milliarden-Schutzschild-fuer-Deutschland.html [7 Mar 2022].
• Bundesfinanzministerium (2021) Steuerliche Hilfen für Unternehmen und Beschäftigte [Online], Available: https://www.bundesfinanzministerium.de/Content/DE/Standardartikel/Themen/Schlaglichter/Corona-Schutzschild/2020-03-19-steuerliche-Massnahmen.html [7 Mar 2022].
• Deutsche Bundesbank (2019) Monatsbericht – Juni 2019 [Online], Available: https:// www.bundesbank.de/de/publikationen/berichte/monatsberichte/monatsbericht-juni-2019-798776 [7 Mar 2022].
• Deutsche Bundesbank (2020) Bankaufsichtliche und regulatorische Herausforderungen in Zeiten von COVID-19 [Online], Available: https://www.bundesbank.de/de/presse/reden/bankaufsichtliche-und-regulatorische-herausforderungen-in-zeiten-von-COVID-19-845288 [7 Mar 2022].
• Deutscher Industrie- und Handelskammertag (2020) Auswirkungen von COVID-19 auf die deutsche Wirtschaft [Online], Available: https://www.dihk.de/resource/blob/33776/520f2d184cf1abdda6872835f463fe73/blitzumfragecorona-nr-5-data.pdf [7 Mar 2022].
• Dresing, T. and Pehl, T. (2018) Praxisbuch Transkription: Regelsysteme, Software und praktische Anleitungen für qualitative ForscherInnen, 8th ed., Marburg: Eigenverlag.