Summary of Covid-19 economic measures
Apart from the human consequences, the coronavirus is also having a major impact on our economy. The National Bank of Belgium is mobilising both its staff and its expertise to deal with the fallout. What exactly is the National Bank doing? What measures has it taken? Below is a brief summary of what is happening.
Economic Risk Management Group (ERMG)
More than 100 members of the NBB’s staff are working round the clock to help the Economic Risk Management Group (ERMG) to map out the scale of the consequences for the economy and for the financial sector, to detect any risks in good time and to come up with recommendations for support measures. This working group, which is co-chaired by NBB Governor Pierre Wunsch and Dr Piet Vanthemsche, brings together representatives of major economic interest groups, the financial sector, public bodies, the Communities and Regions, academics and social partners.
Payment delay and loan guarantee scheme for households and businesses hit by the coronavirus crisis
On 22 March, the National Bank, the Federal Government and the financial sector have agreed a “real financial bazooka” to help limit the impact of the coronavirus crisis. Households encountering financial problems as a result of the coronavirus crisis can get a mortgage payment holiday up to the month of September. Stable businesses and the self-employed can also apply for a payment delay. For new loans to the self-employed or to companies, a € 50 billion buffer has been set aside for cases where instalments cannot be paid because of the coronavirus crisis.
The NBB also published a Q&A for the banks on the technical implementation of the agreement.
In order to assist everyone with their questions and financial difficulties caused by the coronavirus, banking federation Febelfin has set up a central contact point: firstname.lastname@example.org.
The insurance sector is also working to tackle the socio-economic impact of the coronavirus crisis
The Belgian insurance sector will be doubling up efforts to mitigate the negative impact of the coronavirus crisis on private individuals, households, the self-employed and companies. The sectoral organisation Assuralia has reached an agreement on this issue, which was facilitated by the National Bank, with the backing of the FSMA and the Federal Government.
Covid-19 prudential measures
The European Banking Authority has announced actions to mitigate the impact of the coronavirus on the EU banking sector.
The European Central Bank (ECB) supports these actions, and has announced a series of measures to ensure that banks under its direct supervision can continue to finance the real economy as the economic effects of the coronavirus (Covid-19) are felt.
The NBB welcomes these measures and intends to apply them in full to the local and specialised Belgian credit institutions under its direct supervision.
ECB response to the coronavirus pandemic
The ECB has put in place a set of monetary policy and banking supervision measures to mitigate the impact of the coronavirus pandemic on the euro area economy and to support all European citizens.
“Extraordinary times require extraordinary action. There are no limits to our commitment to the euro. We are determined to use the full potential of our tools, within our mandate.” - Christine Lagarde, President of the ECB