They can also resort to undrawn amounts on their credit lines with financial institutions, to new borrowing, such as new bank loans and debt issuances, to divestments, or to new capital contributions from their members. This list of sources of liquidity for firms highlights the important role of economic policy measures in alleviating the effects of the crisis on the business sector. At the European level, the powerful monetary policy response from the European Central Bank (ECB) has proved essential for facilitating the financing of all European firms against this backdrop of high uncertainty, heading off financial fragmentation problems like those experienced as a result of the last crisis. Besides the approval of a new, very large asset purchase programme, this response has included the provision of liquidity to financial institutions under very favourable conditions providing they meet certain business lending targets. In Spain, the public guarantee programmes for loans to firms, which are managed by the Official Credit Institute (ICO)2 and have reduced the risk taken on by banks when lending in such uncertain circumstances, have been crucial, as have the measures to allow for more flexibility in temporary layoffs and short-time work arrangements (ERTE by their Spanish abbreviation) and the payment deferrals on certain tax obligations, among other measures. 2  ICO COVID-19 Guarantee Facility, approved through Royal Decree-Law 8/2020 of 17 March 2020.
The ECB in addition publishes a yearly report on banks’ Pillar 3 disclosures, where we also have the option to publicly list those banks which repeatedly fail to disclose their C&E risks. In view of the poor results shown by our stocktake, and to assess the extent to which the banks address individual feedback, C&E risk disclosures will continue to feature prominently in the ECB’s supervision. We will assess banks’ C&E disclosures again at the end of 2022 and we expect to see major progress by then. Conclusion Let me conclude. Stricter disclosure regulation is on the way, and time is running out for banks to get ready. Five years have passed since the Task Force on Climate-related Financial Disclosures published its recommendations. There are also many initiatives, some of them open source, to support banks’ efforts. Many companies have improved their disclosures and now provide information that can feed into banks’ own disclosure indicators. And for those banks that have systematically fallen behind the ECB’s – and the market’s – expectations there is only one way forward. It is time for banks to be transparent and comprehensive with their C&E disclosures, so we that by bringing them to light, we can progress from an inconvenient truth towards a desirable outcome – for us and for all future generations. Let me end where I started: the first step in coming to grips with any inconvenient truth is full disclosure. 4/4  BIS central bankers' speeches