21 September 2020

According to new research from Moody's Investor Service, UniCredit is one of the world's most resilient banks and well-placed to withstand the adverse effects of the Covid-19 pandemic

2:00 Min

Following years of restructuring and the imposition of new regulations, the 30 G-SIBs entered the Covid-19 pandemic with enhanced solvency and liquidity, stronger balance sheets, more cohesive business models and more cogent strategies, according to research published this week by Moody’s Investors Service.

In the decade following the last financial crisis, the business models (and profitability) of the G-SIBs have been altered by post-crisis regulation, particularly through higher capital requirements, restrictions on leverage, more discriminating risk-weighting, stress testing and enhanced regulatory oversight.

“Without question, the deep changes to balance sheets and business models at many of these large institutions made in the past 10 years have been critical to their current resilience, even in light of the breadth of this crisis,” said Peter Nerby, a senior vice president and co-author of the recent Moody’s research.

These banks’ results have also been supported by their role as strong anchor franchises in their home markets.

UniCredit, for example, is one of several of G-SIBs that are bona fide universal banks with leading positions in retail deposit-gathering for their home markets.

“So far this year, the G-SIBs’ results reflect both the impact of the Covid-19 pandemic and the resilience of their institutions,” Nerby concluded.