In this first of a series of short video clips offering SEACEN insight into a particular topic, Glenn Tasky, SEACEN’s Director of Financial Stability, Supervision, and Payments, discusses the concept of “pro-cyclicality” in banking and banking supervision.
Pro-cyclicality is an acute concern of financial sector regulatory authorities during the COVID-19 pandemic, in which weaknesses in the real sector may reverberate onto the financial sector, perhaps causing banks and other financial institutions to retrench, affecting the supply of credit to the real sector and exacerbating the downturn.
