Financial Stability Review 2021
The coronavirus pandemic is one of the greatest challenges that society and the economy have had to face over recent decades. The financial sector is fundamental to economic development and stabil_ity. During the pandemic, it was able to perform its functions. There was neither a liquidity crunch nor a crisis of confidence. Extensive fiscal policy meas_ures predominantly helped to shield the real econ_omy and – indirectly – the financial system from the pandemic fallout. In this way, impending insolven_cies could largely be avoided. There was no need for banks to use their capital buffers, as the feared sharp rise in losses did not materialise.