COVID-19’s impact on individuals, communities and organisations is rapidly increasing. In addition to the effects on the supply and demand dynamics, COVID-19 has already disrupted the financial markets.
Since the outbreak, bond yields, oil and equity prices have sharply fallen on the global market. The disruption and implications of COVID-19 are also being experienced in our economy. Rapidly changing social norms, restrictions on transportation, a slowdown in the level of economic activity, possible disruptions in the supply chain, high degrees of volatility in the markets and shocks in the market sentiment constitute some of the preliminary challenges being experienced by banks. With ongoing shocks to supply and demand following the lockdown of some parts of the country, there is potential for further market disruption.
Risk managers and assurance practitioners, therefore, need to understand the implications of the outbreak on the banking business and means to effectively manage the risks stemming from it in order to ensure resilience.