COVID-19 and Dollar Funding Strains 8 July 2020 The coronavirus disease (COVID-19) pandemic exposes Asian banks’ vulnerability to U.S. dollar funding risks. A sudden squeeze in U.S. dollar funding liquidity associated with unwinding of carry trades by non-US global banks can quickly spill over to emerging market borrowers, as evidenced during the global financial crisis (GFC). Over the past decade, cross-border bank lending denominated dominantly in U.S. dollar has increased across emerging Asian economies, heightening the exposure to global U.S. dollar funding markets. The crisis offers an opportunity for Asia and the world to regain momentum to reform their financial systems and address the underlying vulnerabilities. This webinar featured a high-level panel of experts who examined the vulnerabilities accompanying the region’s continued growth in cross-border banking activities and explore policy options, including further strengthening of regional financial safety net arrangements, to ensure regional financial stability and resilience moving forward. (Part 4 of the Asian Impact: ADB Research in Action webinar series) Program and Learning Materials 08 July 2020 Session / Activity Title Speaker(s) Presentation COVID-19 Exposes Asian Banks' Vulnerability to US Dollar Funding This presentation examined how dollar liquidity strains during the COVID-19 pandemic exhibits a similar pattern to the global financial crisis, the… Peter Rosenkranz Presentation Emerging Markets in a Time of Pandemic This presentation discussed lessons from the Asian financial crisis in relation to currency and maturity mismatches that are still applicable to the… Hyun Song Shin Disclaimer The views expressed on this website are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. By making any designation of or reference to a particular territory or geographic area, or by using the term “country” in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area. Event Coordinator/s Melissa Gregorio-Dela Paz ADB Organizer/s Economic Research and Development Impact Department Read Also ADB.org event page: COVID-19 and Dollar Funding Strains Publication: COVID-19 Exposes Asian Banks’ Vulnerability to US Dollar Funding Publication: Strengthening Asia’s Financial Safety Net Topics Economics