IMF Predicts Banks Will Struggle at Least 5 More Years After Global Economy Recovers

The International Monetary Fund (IMF) has predicted that banks will struggle to generate profits at least five years after the global economy recovers from the coronavirus-led economic crisis. The IMF explained that banks were struggling even before the covid-19 pandemic so their troubles “will extend to at least 2025, well beyond the immediate effects of the current situation.”

Banks to Face at Least 5 More Years of Hardship

The IMF expects that banks will continue to struggle to generate earnings after the global economy recovers from the economic crisis. In its most recent “Global Financial Stability Report,” the IMF examined banks across nine advanced economies and found that they will struggle to generate profits over the next five years as the coronavirus pandemic causes a sustained period of low interest rates. The IMF described:

Banks’ earnings challenges emerged prior to the recent covid-19 episode and will extend to at least 2025, well beyond the immediate effects…