The famine, the floods, the fires and the refugees are now. COVID-19, however dreadful in itself, provides us with a unique opportunity to regain the lost ground in the battle against climate change and biodiversity loss. Governments worldwide are investing trillions of euro to help our economies recover from the COVID-19 crisis. Let those trillions be green trillions.
The nexus from banks to sovereigns is dampened through the introduction of the SRM and the Bank Restructuring and Resolution Directive. However, the dampening of sovereign risks to banks has not been resolved yet. Up to now there have been some discussions about potential risksensitive capital requirements regulation for sovereign bonds.