Ten months into the COVID-19 crisis, hopes are growing for vaccines and new treatments. But victory over the novel coronavirus still lies some nine to 12 months in the future. In the meantime, second and third waves of infection have arrived in many countries, and as people begin to crowd indoors in the months ahead, the infection rate may get worse. As a result, the potential for near-term economic recovery is uncertain. The question of the day is, “When will the economy return to its 2019 level and trajectory of growth?”
McKinsey’s Global Banking Annual Review, provides a range of possible answers to that question for the global banking industry—some of which are perhaps surprisingly hopeful. Unlike many past shocks, the COVID-19 crisis is not a banking crisis; it is a crisis of the real economy. Banks will surely be affected, as credit losses cascade through the economy and as demand for banking services drops. But the problems are not self-made. Global banking entered the crisis well capitalized and is far more resilient than it was 12 years ago.
Read McKinsey’s review HERE
