Back in Business – CRIFBÜRGEL’s new online portal ensures financial transparency in the crisis

Well-founded information about business partners or suppliers is even more important in times of crisis than in good economic times. With this in mind, CRIFBÜRGEL has developed Back in Business, an online portal that enables companies in Germany to let the market know that they are back in business. Companies that rebuild and strengthen their business relationships with customers, suppliers, dealers and importers are thus supported in showing financial transparency.

Companies benefit from the Back in Business initiative on several levels. First of all, the portal offers them a simple and free opportunity to provide their business partners and suppliers with an up-to-date picture of their economic performance and thus to document their activities with regard to future-oriented entrepreneurship.

As part of the Back in Business network, companies also benefit from exclusive access to webinars and services.

Further information can be found here.


Text by CRIFBÜRGEL

KfW Business Survey 2020: Lending climate – Businesses are well-equipped for the crisis

In cooperation with 19 trade associations, KfW Group has conducted a business survey on banking behaviour and financing for the 19th time.

The survey was carried out between mid-December 2019 and the end of March 2020, overlapping with the outbreak of the coronavirus pandemic and the containment measures introduced in the second half of March. The survey revealed that the financing situation of enterprises in Germany was good until the outbreak of the coronavirus crisis. Enterprises’ robust self-financing capacity, low interest rates and German banks’ relaxed lending criteria were major contributors.

The most important results are:

  • The financing situation remained good until the outbreak of the coronavirus crisis.
  • The proportion of enterprises reporting difficulties in accessing credit was 13.4%.
  • As before, however, small businesses are still much more likely to face difficulties in accessing credit.
  • The positive development of businesses’ equity ratio and credit rating continued up until the beginning of 2020.
  • Bank loans remain an important source of funding for businesses. Internal funding, however, continues to play by far the most important role in business financing.

Please find a summary at: KfW Business Survey 2020: Access to finance

 

Text: KfW

Photo: ArtCoreStudios/Pixabay

AFME Market Update: Impact of COVID-19 on European Capital Markets

The Association for Financial Markets in Europe (AFME) has published a new research note on the “Impact of COVID-19 on European Capital Markets: Market Update”.


The purpose of this report is to provide an update on how European capital markets have performed during the COVID-19 outbreak. This report follows a first publication launched in mid-April which assessed the initial impact of COVID-19 on Europe’s capital markets.

Key findings include:

  • Issuance levels of investment grade (IG) bonds have reached record weekly, monthly and quarterly volumes.
  • An ESG recovery.
  • European market liquidity has deteriorated over the last few months.
  • Follow on equity offerings have continued to support the recovery.
  • After two months of a virtually inactive IPO market, the European primary equity market reopened in May with EUR 3.6bn in proceeds from 24 deals.
  • European listed SMEs have also benefited from access to equity capital, predominantly from secondary offerings on Junior exchanges.
  • Record volumes of bank lending.

Please find the full research note at: AFME Market Update: Impact of COVID-19 on European Capital Markets


The Association for Financial Markets in Europe (AFME) is the voice of all Europe’s wholesale financial markets, providing expertise across a broad range of regulatory and capital markets issues.

 

Photo: Fernando Zhiminaicela/Pixabay

COVID-19 Scenarios and their Socio-Economic Implications by Prof. Alexander Van de Putte (AIFC)

Z/Yen Group Limited held a private online meeting on 15. July 2020 with representatives of international financial centres from the City of London, Abu Dhabi, Shanghai, Shenzhen, Luxembourg, Tokyo, Hong Kong, Astana, Frankfurt and many more. The main aims were to work closer together and to discuss the impact of COVID-19 on global financial centres, the recovery plans of restarting economies and the future strategic changes in financial centers over the next decade.

Prof. Alexander Van de Putte, Chief Strategy Officer of the Astana International Financial Centre (AIFC), shared some COVID-19 Scenarios and their Socio-Economic Implications until 2022. In his presentation you will find insights into:

– Various Types of Foresight Tools

– The Emergence of Global Pandemic

– Taking Stock of what has happened so far

– The Scenarios and its Socio-Economic Implications

Please find his presentation here: Prof. Alexander Van de Putte (AIFC): Covid-19 Scenarios


The Astana International Financial Centre (AIFC) is a financial hub for Central Asia, the Caucasus, the Eurasian Economic Union (EAEU), the Middle East, West China, Mongolia and Europe.

KPMG ECB Office: Implications of COVID-19 on the European banking sector

Since March 2020, KPMG‘s ECB Office has published a new newsletter dealing with the impact of COVID-19 on the European banking sector. The insights and materials have been created to help you respond to the challenges of the present, and prepare for the future and the new reality.

Read more

European DataWarehouse: Monitoring the impact of COVID-19

European DataWarehouse (EDW) has published a short paper showing that some of the effects of the COVID-19 crisis were already visible in the Loan Level Data (LLD) dated 31st March 2020.


Starting from a few cases in early February 2020, COVID-19 spread throughout Europe, forcing governments to enact severe social distancing measures. It is expected that the crisis will lead to substantial amounts of loan modifications. EDW used the reporting criteria suggested to flag loan modifications due to COVID-19 to see to what extent these are already visible.

Most governmental decisions on social distancing were enacted in March 2020. These measures have severely reduced the income of some borrowers from mid-March onwards. Governmental support, when available, was often delayed and often failed to fully compensate for lost income, leaving some borrowers having to pay more than they could afford. To compensate, some borrowers either withdrew on their savings or asked for a credit or payment holiday. Governments have encouraged lenders to grant forbearance measures to help borrowers and soften the blow to the economy. In several countries, it was reported that measures such as allowing a temporary switch to interest only payments or payment holidays have indeed been granted to a substantial number of borrowers.

In this respect, EDW’s data will make it possible to monitor these changes given that specific reporting guidelines are available to help data providers.

Read the short paper here: European DataWarehouse Report – Monitoring the impact of COVID-19


EDW became operational in 2013 in the wake of the 2008 financial crisis to satisfy the need for more transparency in the securitisation market. Their loan-level data will make it possible to assess the effect of the current crisis on securitised portfolios, in a way that would not be feasible looking only at investor reports.

Oliver Wyman study on the effects of the corona pandemic

Source: www.oliverwymanforum.com

“The coronavirus pandemic strikes at some of the central features of urban living. The disease has taken a heavy toll on major cities like New York City, Madrid, and Sao Paulo, and efforts to stop its spread with lockdowns and social distancing raise questions about the density of human activity and interaction that have long drawn people to cities. Now growing numbers of people in the United States and United Kingdom are looking to move or have already done so, and many have changed their criteria for deciding where to live, according to new research from the Oliver Wyman Forum.

A survey of 1,100 Americans found that two percent of respondents have permanently or temporarily relocated because of COVID-19, while another 14 percent are planning to relocate or leaning toward doing so. Affluent respondents were the most mobile, as three percent of respondents with incomes of more than $120,000 have already relocated. Urban residents, renters, and younger respondents were the most likely to be planning or considering a move.”

A detailed overview and discussion of the study results can be found on the Oliver Wyman Forum website.

Good advice in the pandemic: The hour of the economists (Comment by Gerald Braunberger)

With conspiracy murmurs, verbal witch hunts, muffled roars and other forms of escapism, neither crises nor their aftermath can be meaningfully combated. Progress is more likely to be found through expertise and the willingness to discuss old and new findings in a meaningful and open-ended manner.

Read more

What will the post-COVID era look like in Africa? What are the challenges and opportunities?

Our partner Casablanca Finance City will host a webinar on the challenges and opportunities that the post-Corona era provides for Africa:

Lockdown may progressively be lifting in Africa but its impact will live on. Casablanca Finance City is bringing together international experts and representatives from companies operating in Africa, to discuss the outlook and prospects of post-COVID Africa.

The panel will cover field experiences from different industries and the impacts on their respective businesses:

  • How will the private sector be impacted in Africa?
  • How is the financial services community supporting companies operating on the continent?
  • How can the digitalization boost be leveraged to support economic recovery? What are the risks?
  • What are the social impacts between employers and employees?

 

Understanding the landscape in a post Covid era: Outlook and prospects in Africa

Wednesday, May 20, 2020

12:00 pm Casablanca Time (UTC)

Moderator: Peter Walts, COO, ELA Alliance

Register here.

World Alliance of International Financial Centers (WAIFC) publishes Corona Report

The World Alliance of International Financial Centers (WAIFC) publishes a report on “How global financial centers can help combat the COVID-19 pandemic.”

 

Rarely has the world faced challenges such as today. Whatever comparison is drawn, COVID-19 and efforts to curb its spread are poised to inflict strain of historic proportions on the world’s economy and financial systems. Within just weeks, economic growth has ground to a halt and gone into reverse. The virus knows no borders, nor can economic actions be seen in splendid isolation. Wouldn’t it have been helpful had the world been prepared for such a crisis on this global scale?

The WAIFC is a global association comprised of the world’s leading financial centers from four continents. We believe it is time to overcome our borders and put competition aside for more cooperation and exchange of best practices. We are convinced that global challenges require global responses.

Together with WAIFC member Frankfurt Main Finance, WAIFC has published a report on “How global financial centers can help combat the COVID-19 pandemic,” which highlights lessons learned of the past as well as current activities of our members.

It includes an interview with Christopher Hui, Executive Director of the Hong Kong Financial Services Development Council, who explains why Hong Kong was able to recover quickly from SARS crisis 2003 and what Hong Kong learned for the current crisis: “Our SARS experience has driven us to respond sooner and with adequate caution to COVID-19.”

And Hiroshi Nakaso, Chairman of FinCity.Tokyo, talks about lessons learned from the Tohoku Earthquake in 2011: “The Bank of Japan has a long tradition of quickly responding to a crisis as it unfolds.”

The report is available for free download at https://frankfurt-main-finance.com/wp-content/uploads/2020/04/WAIFC_Publication-on-COVID-19.pdf.

 

Arnaud de Bresson, Chairman of the WAIFC Board of Directors and CEO of Paris Europlace, says:

“The first lesson is that all the countries are concerned all around the world and therefore we are in the same boat: to maximize the chances to win this war we must share and work together. A second lesson is that we have to reconsider our economic models and give a new priority to long term perspectives and sustainable economy, it means environmental and social issues. It is the essence of WAIFC to contribute to these new goals and long term partnerships.”

Hubertus Väth, Member of the WAIFC Board of Directors and Managing Director of Frankfurt Main Finance, says:

“We have much to learn from each other and history. Financial centers like Hong Kong or Tokyo successfully coped with similar challenges in the past. We should draw on these experiences. That is the motivation of our publication. We not only share today’s responses and best practices, but we also reflect on historical experiences. It will prove that our financial systems are essential to the solution, and the world can cope with such challenges, given the right response.”

Dr. Jochen Biedermann, Managing Director of the WAIFC, says:

“Our members, the world’s leading financial centers, stand together and do their part to mitigate the current crisis and prepare for a rapid economic recovery. That is an excellent sign and encourages us to continue our work at full strength.”

  

The World Alliance of International Financial Centers (WAIFC) is a non-profit association registered in Belgium, representing 16 leading international financial centers of four continents. WAIFC members are city governments, associations, and similar institutions developing and promoting their financial centers.

In an era of breakthrough technologies and rapid social change, financial centers are crucial to sustaining economic growth. Thus, the objective of the WAIFC is to create a transparent network that facilitates cooperation and sharing of best practices to further the understanding of the importance of international financial centers for national and global economies as well as social development.