Abstract
[Autom. eng. transl.] The outbreak of the Covid-19 pandemic and the subsequent restrictive measures aimed at containing the contagion have led to a sudden and significant slowdown in the world economy and in Italy in particular.
To deal with these economic effects, the Italian government, together with the governments of other European countries, promptly approved specific measures aimed at favoring businesses and individuals in need of liquidity.
Among the main measures introduced, those relating to the granting of state guarantees on loans (through SACE guarantees and guarantee funds for SMEs) and the partial or total moratorium measures on loans, in an actuarial neutrality regime, are of particular importance.
The measures related to the credit moratorium have had a positive impact in maintaining liquidity conditions in the economic system. It was a particularly significant intervention also on a quantitative level.
The introduction of moratorium measures has had a significant impact on the strategies and objectives of the credit risk management policies of the banks. In fact, it must be considered that – on the basis of initial estimates made by market operators – around 20% of the credits subject to the moratorium could be at risk; if that were to happen, banks would suddenly find themselves dealing with a worrying surge in new NPLs. A cliff effect that institutions are trying to avoid by implementing remedies that involve the entire credit management organization.
For these reasons, considerable attention has been paid by the national and European Supervisory Authorities to the possible deterioration effects of the counterparties which, in the face of the suspension of payments, may not be punctually and promptly intercepted by the intermediaries. The main concern is the potential effects that the deterioration of debtors - not perceived following the suspension of payments - could generate once the government measures expire on the stability of financial intermediaries.
Against this situation, already in 2020 the banks, albeit following different approaches, carried out prudential measures on their balance sheets, introduced extraordinary adjustments to the value of loans and revised the processes of classification and assignment of the forborne attribute (credits subject to concession). This in order to prepare for the feared cliff effect deriving from the subsequent easing of the favorable measures.
After highlighting that the use of moratorium measures is not a new phenomenon for the Italian banking system, the paper focuses on the model for determining loan adjustments designed by IFRS 9. Starting from this framework, the accounting effects of the interventions of the Supervisory Authorities on the treatment of the exposures subject to the moratorium and, then, reconstructed the behavior of the financial statements of some of the main Italian credit institutions, starting from the data communicated in their financial and supervisory reports. At the end, some reflections are formulated on the exit path from the moratorium regime, which depending on the position of the various institutions could give rise to instrumental releases of previous provisions.
Translated title of the contribution | [Autom. eng. transl.] The Covid-19 moratoriums: the effects on bank balance sheet policies |
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Original language | Italian |
Title of host publication | Il sistema finanziario europeo nella prospettiva post-Covid |
Editors | Francesco Cesarini, Elena Beccalli |
Pages | 43-66 |
Number of pages | 24 |
Volume | 2022 |
Publication status | Published - 2022 |
Keywords
- moratoria
- bilancio bancario
- Covid-19