Each country responded to the pandemic by taking preventive measures, such as restrictions on entry/travel and going outside, as well as orders to suspend business and production activities. Since economic activities were constrained substantially, the global economy became depressed significantly in the first half of this year (Chart 1).
This performance reflects partly further write-downs on structured product portfolios and increasingly the deterioration in the macroeconomic environment, which resulted in an increase in loan losses and a decline in non-interest revenue. In the first quarter of 2009, euro area banks’ ROE improved somewhat, albeit at a very low level, thanks to a more favourable trading environment and better non-interest revenues.