Front Matter Page
European Department
Table Of Contents
Abstract
Table Of Contents
I. Introduction
II. The European Corporate Landscape Prior to the Pandemic and Recent Developments in Bankruptcies
III. The European Policy Response
IV. Modeling Framework
A. A Balance Sheet Approach to Capture Liquidity and Solvency Risks
B. Balance Sheet Dynamics
C. Scarring and Leverage
V. The Data Sets
A . The COVID-19 Sectoral Shocks
B. Firm-Level Balance Sheet Data
C. Country-Specific Policy Responses
VI. The Impact Of The Pandemic Without Accounting For Policy Measures
VII. The Impact Of The Pandemic After Accounting For Policy Measures
VIII. Policy Implications and Conclusion
References
Box
1. Illustration of Country Policy Schemes Incorporated in the Simulations
Figures
1. Corporate Sector Indicators
2. Corporate Insolvency in Europe
3. Intensity of Policy Measures
4. Liquidity and Solvency Nexus
5. Balance Sheet Structure and Cost Structure in Europe
6. Balance Sheet Simulation Stages and Scenarios
7. Sectoral COVID-19 Shocks
8. Liquidity and Solvency Projections without Policy Measures
9. Liquidity and Equity Gaps, by Firm Type
10. Share of Financially Distressed Firms in Selected Sectors
11. Liquidity Gaps Covered by Policies
12. Increase in Liquidity Gap Versus Increase in Share of Illiquid Firms
13. Liquidity Gaps Covered by Policies by Firm Type and Sector
14. Equity Gaps Covered by Policies
15. Increase in Equity Gap Versus Increase in Share of Insolvent Firms
16. Equity Gaps Covered by Policies by Firm Type and Sector
17. Distribution of Firms by Liquidity and Solvency Position
18. Leverage Ratio of Pre-COVID-19 Highly Leveraged Firms
Tables
1. Stylized Balance Sheet and Income Statement of a Firm
2. Firm Coverage in the Sample
Appendix
Figure 1: Policy Measures Incorporated in the Simulations by Country