One pleasant surprise of the pandemic has been the shortage of business bankruptcies, despite recurrent lockdowns that have drained their incomes. But is this rosy picture a cruel illusion to be removed as governments stop propping up small companies? Banks will soon find out if government life support has simply delayed the inevitable.
The introduction of a Central Bank Digital Currency (CBDC) is taking concrete shape in more and more countries economic and currency areas. The European Central Bank (ECB) is currently evaluating the specifications of a digital Euro, Sweden recently extended the test phase for its own CBDC and in China,
Mazars’ study on sustainable finance surveying 37 banks in North and South America, Asia and Europe indicates that progress is being made, especially in the UK and France, toward reaching ESG targets. Although improvement is still required in specific areas, banks and various agencies are joining forces to achieve sustainability goals.
Spring is in the air, and so is price inflation in the UK, which saw its inflation rate rise sharply in April. Leading the way were prices for energy, utilities and clothing, primarily due to the lifting of COVID-related restrictions. As the rate closes in on the BoC’s target of 2 percent, will this upward trend be permanent or transitory?
The Brexit referendum delivered a punch to the UK’s pound, but the currency has slowly picked itself up and gained some strength despite the pandemic, once again closing in on the US$1.40 mark in February. How well it fares over the next few months will depend on several factors—including the UK’s COVID-19 response but also the raft of unique issues that the nation will face as it evolves post-Brexit.
Throughout the stress test of the past year, resilience rose to the height of visibility as many organizations faced new and daunting challenges. As a result, operational resilience simultaneously rose to the top of executives’ and regulators’ priorities. In fact, our recent exercises demonstrate that resilience is within the top three priorities on executive radars.
Today’s professional accountant is expected to do more than juggle numbers; he or she increasingly participates in achieving sustainability objectives, which aim to ensure that a company’s resources are used to create not only monetary value but sustainable value today and into the future. To achieve this requires concerted multidisciplinary effort toward enhanced corporate reporting that addresses financial and sustainability concerns, guided by international accounting standards that incorporate sustainable value creation.
The UK’s economy showed promising signs of recovery during the fourth quarter of 2020 but not enough to compensate for a dismal year, which, with its annual 9.9-percent contraction, broke a 300-year record and clocked in among the G7’s worst economic performances. Although 2021 is getting off to a slow start with new lockdown measures, increased vaccination and more consumer spending may fuel a vigorous rebound later in the year.
2020 wasn’t a good year for shareholders scheduled to receive bank dividends. Regulators swiftly put a halt to dividend payments from banks to ward off a pandemic-induced crisis, requiring lenders to conserve capital and distribute it as needed to consumers and businesses. The dividend pipeline is slowly reopening as confidence grows in the banks’ stability, but it may be a while before shareholders receive their fair shares of the profits.
2020 has proved to be an eventful year for ISO 20022, with SWIFT (Society for Worldwide Interbank Financial Telecommunication) and other major market infrastructures opting to postpone the implementation of the new standard. Any assumptions that these delays will provide participants with a respite are unfounded; testing times still lie ahead, and internal project work should reflect this.