Public Banks and Covid-19: Combatting the Pandemic with Public Finance

Coronavirus should not have been such a surprise, because its unfolding has followed astonishingly closely the path of a “climate Minsky moment.” This publication focuses on the role that public banks institutions and associations across the globe have played in managing the economic crises of Covid-19 to date. Among others, it (i) details the key features that PDBs, at different levels, need to possess to maximize development results for the most vulnerable members of society; (ii) offers two brief case studies detailing CEB’s Covid-19 lending to Spain, which involved a €200 million loan to the Comunidad de Madrid, and a €300 million loan to the Instituto de Crédito Oficial (ICO) to support micro-and small-sized companies; (iii) focuses on the strategic role played over the first few months after the beginning of the Covid-19 pandemic by a Multilateral Development Bank – the Inter-American Development Bank (IADB) – and a National Development Bank – the UK CDC Group.