Editorial : Regulation has strengthened the financial system’s resilience

Abstract

The resilience of banks, firms, and households is being put to the test as the Finnish economy and the economies of its important trading partners experience a sharp contraction. However, financial institutions' solvency and liquidity positions have been strengthened significantly since the global financial crisis, and borrowers are in many respects on sounder footing than they were before the financial crisis or during the Finnish banking and economic crisis of the early 1990s. Strong capital adequacy ensures that banks are better equipped to lend to households and firms. A well-functioning banking sector together with government relief measures will bolster the economy's outset for growth after the crisis.