ECB and EBA provide clarification to banks in reaction to Covid-19

The European Banking Authority (EBA) published on April 2, 2020 a more detailed guidance on the criteria to be fulfilled by legislative and non-legislative moratoria applied before 30 June 2020 and do not to trigger forbearance classification.

In addition, with regard to the IFRS 9, The European Central Bank (ECB) published further guidance on the use of forecasts to estimate the ECL during the COVID-19 pandemic.

This article provides further insight on the main supervisory and prudential measures by the EBA and ECB as reaction to the disruption caused by the coronavirus, while further measures are expected to be announced.