So banks should be careful and not release provisioning too soon. The Covid-legacy also means banks need to take a close look at another part of their defences: risk management. The pandemic presents unique challenges for managing credit risk. Assessment of bank practices by supervisors, at least in the eurozone, shows that not all the banks have sufficiently strong credit risk practices in place.
As I indicated earlier the public sector should achieve an overall surplus of just under 0.5 per cent of GDP with crude oil prices holding at around current levels in the range of around $ a barrel.