25 May 2020|Moody's Investors Service
On 20 May, the Bank of Italy provided an update on payment holidays for households and small and midsize enterprises (SMEs), and banks' origination of state-guaranteed loans to corporates. Italian banks' increased supply of corporate loans is credit positive because it will help mitigate Italy’s economic downturn, partially protecting banks' asset quality.
26 May 2020|Moody's Investors Service
On 8 May 2020, the European Commission confirmed that the shareholders and subordinated creditors of banks that receive public support to help them withstand coronavirus-related pressures will not be required to bear losses through write-down or conversion to equity, as would normally be the case under European Union state aid rules.
Sovereigns – Global: G-20 debt service freeze supports liquidity, high debt level challenges will intensify
18 May 2020|Moody's Investors Service
The G-20 Debt Service Suspension Initiative (DSSI) announced on 15 April will free up resources for coronavirus-related spending, but at this stage is unlikely to ease the significant credit challenges that have been amplified by the coronavirus outbreak.
Supranational issuers – Global: FAQ on MDB credit quality in the context of the coronavirus outbreak
13 May 2020|Moody's Investors Service
Multilateral developments banks (MDBs) play an important role in mitigating the economic and financial impact of the coronavirus pandemic on their borrowers. This report looks how MDB's responses to support vulnerable borrowers during the pandemic and the G-20 debt-relief initiatives may impact their credit metrics.
07 May 2020|Moody's Investors Service
Major Latin American economies have put in place coronavirus support measures that include cash payments to low-income households, liquidity support for businesses and tax deferrals. But this support will not offset the rising recessionary momentum in the region or credit risks for most sectors.
29 Apr 2020|Moody's Investors Service
Fiscal and monetary authorities are increasingly stepping up the level of support to their respective economies. Fiscal measures include immediate support to households in the form of tax relief and transfers, credit lines and subsidies to businesses and explicit government guarantees on bank loans.
Macroeconomics – US: Small business struggles will persist despite added support, a risk to jobs and growth
27 Apr 2020|Moody's Investors Service
On 23 April, the US Congress approved a coronavirus relief measure that will inject an additional $320 billion into the Paycheck Protection Program (PPP), a loan fund for small and midsize enterprises (SMEs) that exhausted its initial $349 billion in funding within two weeks of the program’s launch.
Sovereign – Global: Potential credit implications of G20 debt relief initiative for private-sector creditors
24 Apr 2020|Moody's Investors Service
The G20 nations have confirmed their willingness to offer debt relief to low-income countries to allow them to devote scarce fiscal resources to vital humanitarian and economic remediation efforts during the coronavirus pandemic. However, calls for private-sector participation could lead to the suspension of payments on private-sector bonds and loans, which could represent a default according to Moody's definitions.
Coronavirus – China: Policy response aims to support short-term growth and employment; credit effects vary
28 Apr 2020|Moody's Investors Service
The measures, which include increased fiscal spending and targeted monetary easing, will help contain the damage to the Chinese economy from the coronavirus outbreak and facilitate modest economic recovery beginning in the second half of 2020.
Regional & Local Governments – Japan: Central government support will partly offset financial pressures from coronavirus
27 Apr 2020|Moody's Investors Service
The rapid spread of the coronavirus will pressure RLGs by lowering tax revenues and increasing healthcare costs, although central government support will help to mitigate these effects.
Nonfinancial companies – EMEA: Benefit of state coronavirus support will depend on conditions attached
23 Apr 2020|Moody's Investors Service
The type of support governments offer companies to help ease the economic impact of the coronavirus outbreak could be very relevant for credit quality. If financial support comes without conditions, then it would be largely supportive of credit quality, even if in the broader context the support is not enough to avoid negative rating actions.