Royal Bank of Canada and Bank of Montreal joined their Canadian peers in setting aside record provisions for loan losses as they brace for the economic fallout from the coronavirus pandemic.
The central bank's Financial Stability Report said companies may face difficulties repaying debt given lower earnings, “which could trigger a sizable increase in firm defaults."
The Federal Reserve also said in a supervisory report released Friday that it would conduct stress tests this quarter as planned, taking into account sudden deterioration in the economy brought on by the coronavirus pandemic.
Frank Bisgnano, who engineered a technology-driven recovery at First Data before it was acquired by Fiserv last year, will shortly take Fiserv's top job as the company forges its coronavirus strategy.
U.S. banks under $10 billion in assets made 60% of the loans in the first round of the Paycheck Protection Program; things go relatively smoothly in the U.K. as 110,000 small businesses apply for low-cost loans.
The millions of dollars earned from Paycheck Protection Program transactions will help cover rising provision costs tied to the new CECL accounting standard and coronavirus shocks to loan books.
A former economist says high-ranking officials engaged in “legally risky” behavior to downplay consumer harm; online payments and contactless transactions jumped in the first quarter, and some think the new habits will stick.
