In a personal message to my fellow Central Bank Governors on September 5, 2020, I summarized the situation as follows: “COVID has tested us all and continues to re-test us every month with the new revelations. So far all in our families are okay and we pray for ‘rona to be gone soon.
We need to strike the right balance between rules and discretion in financial regulation, making full use of the “Three Pillars” framework of the Basel Accords, especially Pillar II. I also reiterate that liquidity issues are critical, especially from a cross-border perspective. Central banks are strongly required to monitor liquidity risk, and provide liquidity if necessary, so as to contain cross-border spillovers.