Managing Financial Sector Risks from the COVID-19 Crisis in the Caucasus and Central Asia
Departmental Papers, March 10, 2022
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- Managing Financial Sector Risks from the COVID-19 Crisis in the Caucasus and Central Asia
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Bibliographic details
- Authors: Iulia Ruxandra Teodoru, Klakow Akepanidtaworn
- Published: March 10, 2022
- Series: Departmental Papers
- DOI: https://doi.org/10.5089/9798400201189.087
Key findings and risk assessment
- The COVID-19 crisis raises the risk of renewed financial sector pressures in the Caucasus and Central Asia (CCA) region in the period ahead.
- Bank distress and its economic and fiscal fallout have been recurring features of many CCA countries, as seen after the global financial crisis and the 2014–15 oil price shock.
- Strong policy responses have delayed the full impact of the COVID crisis so far.
- Financial sector risks will increase once public support is phased out.
- If these risks are not preemptively addressed:
- Banks’ ability to lend during the recovery phase could be impaired.
- There may be a need for costly public interventions, as in the past.
Subjects and technical focus
- Commercial banks
- Credit risk
- Financial institutions
- Financial regulation and supervision
- Financial sector policy and analysis
- Financial sector risk
- Foreign exchange
- Nonperforming loans
Keywords and analytical tools
- CCA bank's capital adequacy ratios
- CCA banking systems
- CCA country
- Central Asia and the Caucasus
- Commercial banks
- Credit risk
- Financial risks
- Financial sector risk
- financial supervision and regulation
- FX risk
- FX-induced credit risk
- Nonperforming loans
- stress tests
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