{
  "title": "Corporate Funding and the COVID-19 Crisis",
  "publication": "IMF Working Papers, March 19, 2021",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2021/03/19/corporate-funding-and-the-covid-19-crisis-50267",
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  "summary": "This paper assesses whether corporate liquidity needs in the G7 economies were met during the containment phase of the COVID-19 pandemic (February-June 2020) using various approaches to identify credit supply shocks.",
  "sections": [
    {
      "heading": "Scope and approach",
      "content": "- Assesses whether corporate liquidity needs in the G7 economies were met during the containment phase of the COVID-19 pandemic (February-June 2020).\n- Uses various approaches to identify credit supply shocks.\n- Focuses on nonfinancial corporate sector cash flows, liquidity and solvency pressures, and market- and bank-based corporate funding."
    },
    {
      "heading": "Key findings on corporate cash flows and borrowing",
      "content": "- The pandemic crisis adversely affected nonfinancial corporate sector cash flows, generating liquidity and solvency pressures.\n- Corporate borrowing surged in March and into the second quarter, driven by credit line drawdowns and unprecedented policy support.\n- Residual signs of strain remained as of the end of June."
    },
    {
      "heading": "Market- and instrument-specific outcomes",
      "content": "- United States:\n  - The bond market was buoyant from the end of March onward.\n  - Credit supply conditions for bank loans and the syndicated loan market tightened.\n- Other G7 economies:\n  - Credit supply conditions generally eased somewhat across markets during the second quarter."
    },
    {
      "heading": "Firm-level heterogeneity",
      "content": "- Among listed firms, entities with weaker liquidity or solvency positions before the onset of COVID-19 suffered relatively more financial stress in some economies in the early stages of the crisis.\n- Smaller firms experienced relatively more financial stress in some economies in the early stages of the crisis."
    },
    {
      "heading": "Policy impacts",
      "content": "- Policy interventions, especially those directly targeting the corporate sector, had a beneficial effect on credit supply overall.\n- Unprecedented policy support was an important factor enabling the surge in corporate borrowing in March and into the second quarter.\n\nSource: Corporate Funding and the COVID-19 Crisis — IMF Working Paper (February-June 2020), https://www.imf.org/en/publications/wp/issues/2021/03/19/corporate-funding-and-the-covid-19-crisis-50267\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2021/03/19/corporate-funding-and-the-covid-19-crisis-50267"
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    "Authors: Andrea Deghi, Dulani Seneviratne, Tomohiro Tsuruga, Jerome Vandenbussche",
    "Published: March 19, 2021",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781513574158.001",
    "Assesses whether corporate liquidity needs in the G7 economies were met during the containment phase of the COVID-19 pandemic (February-June 2020).",
    "Uses various approaches to identify credit supply shocks.",
    "Focuses on nonfinancial corporate sector cash flows, liquidity and solvency pressures, and market- and bank-based corporate funding.",
    "The pandemic crisis adversely affected nonfinancial corporate sector cash flows, generating liquidity and solvency pressures.",
    "Corporate borrowing surged in March and into the second quarter, driven by credit line drawdowns and unprecedented policy support.",
    "Residual signs of strain remained as of the end of June.",
    "United States:",
    "Other G7 economies:",
    "Among listed firms, entities with weaker liquidity or solvency positions before the onset of COVID-19 suffered relatively more financial stress in some economies in the early stages of the crisis.",
    "Smaller firms experienced relatively more financial stress in some economies in the early stages of the crisis.",
    "Policy interventions, especially those directly targeting the corporate sector, had a beneficial effect on credit supply overall.",
    "Unprecedented policy support was an important factor enabling the surge in corporate borrowing in March and into the second quarter.",
    "**Working Paper**"
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