The Impact of the COVID-19 On Eurozone and the United States Banking Sectors. Contribution to The Post Pandemic Scenarios

The article discusses the role of banking sectors in Eurozone countries and the United States in times of the COVID-19 pandemic. The presented analysis is related to the commercial banks’ sector and central banking during the pandemic. It shows that commercial banks were affected by the consequences of the pandemic situation in terms of capital market indices, lending activity and profitability of banking sector. Both central banks, the European Central Bank and Federal Reserve, implemented new phases of the quantitative easing (QE) policy as the reaction to the economic situation triggered by the pandemic. In consequence the value of balance sheets of both of central banks almost doubled during the last twelve months. In the short-term, such policy is beneficial for both economies. The long-time outcome is unknown. Another challenge is the scenarios of economic recovery. There are some positive, negative, and neutral scenarios possible to happen. The positive expectations assume that the economic activity will be restarted. The pessimistic one indicates some acute problems and asymmetrical recoveries (especially in some Eurozone countries) which might trigger political tensions among countries. There is still a significant role of a banking sector for further support of economies in the post-pandemic time.