Coronavirus (COVID-19) Updates

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From Credit Unions, For Credit Unions

World Council created this page as a resource for the latest Coronavirus (COVID-19) news, information and recommendations specifically relevant to credit unions across the globe. All of the content is provided by World Council, its members, or their affiliated credit unions and financial cooperatives. To share information from your organization on this page, please email us at communications@woccu.org.

Basel Committee Issues COVID-19 Statement

The Basel Committee on Banking Supervision (Basel Committee) is coordinating policy and supervisory response to the COVID-19 (Coronavirus) crisis and has issued a statement on their efforts.

The Basel Committee notes that member jurisdictions are pursuing a range of regulatory and supervisory measures to alleviate the financial stability impact of Covid-19, including measures targeting the provision of lending by banks to the real economy and facilitating banks' ability to absorb losses in an orderly manner. The Committee notes that supervisory authorities also have additional flexiblity to undertake further measures if needed.  

In particular, the Basel III framework includes capital and liquidity buffers that are designed to be used in periods of stress. These include the capital conservation buffer and, by extension, the counter-cyclical capital buffer and buffers for systemically important banks. They also include banks' stock of high-quality liquid assets (HQLA). Using capital resources to support the real economy and absorb losses should take priority at present over discretionary distributions. HQLA stocks should be used to meet liquidity demands. Many supervisors are already encouraging banks to make use of these tools, which allow for flexibility in responding to the current circumstances. 

For credit unions, WOCCU is also urging national-level regulators to take note of this guidance and similarly allow for flexibility that will allow credit unions to serve their members during the crisis.

A copy of the Basel Committee statement can be viewed here.