The COVID Diaries: bank issuer 1

The following interview is with an Australian-based bank treasury executive. It was conducted on 9 April 2020.

We are now into the second month of home working. Is cabin fever starting to set in? Do you think we can continue doing business in this fashion for three to six months?

I am still working from the office but surrounded by a sea of empty desks. The balance of the team is working virtually and probably suffering from cabin fever.

One of the key considerations from both a personal and team perspective is ensuring psychological and emotionally resilience in the face of challenging external conditions. We have focused on ensuring we each have process and mechanisms for managing change in our personal and working environments. Success here is pretty critical measure for the team going forward.

Do you feel you have adapted to working from home and how close are you to business as usual – personally and in the sense of market functionality?

We are quite lucky in that treasury moved to a virtual environment in late January. Since that point, we been working through the wrinkles in technology and building out all the virtual business functionality that you don’t think you need at home but actually do.

Information flow is always important but becomes more critical in a virtual environment so we spend a lot of time on conference calls and Zoom to ensure everyone is on the same page.

I would say we have done reasonably well in this regards and are functioning pretty much on a business as usual basis. In many ways it’s similar to managing a team across multiple jurisdictions.

“There are potentially some substantial implications for society, consumer behaviour and international relations more generally. The consequences of these may be more profound than anything witnessed since the 1930s.”

Has your view of the crisis and the nature of the challenges it presents changed? It seems Australia has prioritised public health over the economy, at least in the medium term. How are you thinking about that trade off?

For me the trade-off is best viewed with a medium-to-long term lens. In the first instance, we need to be cognisant that this crisis is different to what we have experienced in the past – it’s not a banking crisis per se but a public health crisis.

At present there is no vaccine for COVID-19. If you look historically at what tended to happen in pandemics or viral breakouts prior to the development of vaccines, there were multiple waves of infection.

It’s reasonable to expect a rolling period of tightening and lifting of restrictions over time. A good example of this is Singapore, where there were very stringent measures implemented to flatten the curve, these measures were marginally loosened as the spread of the virus slowed however controls have been tightened to address the re-emergence of the virus.

While there is talk of lifting some of the key mechanisms to mitigating the domestic spread of the virus, we need to be mindful that the virus is still in the community and is likely to reappear, and perhaps be more virulent, over winter. As a consequence, we need to be patient and resilient and not expect a short-term fix. There is a light at the end of the tunnel but it is a long way off – more likely 12-18 months.

On trade-offs, there are multiple hypotheses on how society and the economy may evolve over the medium term. The key for me at present is executing ‘no regrets decisions’ while maintaining all available optionality and flexibility to adjust once there is a clearer view on how conditions evolve.

How do you think things will be different when we get back to normal? What changes can you see to work practices, social changes and the economy?

At present, there are a large number of questions with no clear answers, A couple of examples: Are we going to experience a recession or depression. Will the recovery be ‘L’, ‘V’, ‘U’ or other shaped? How will the economy function after the crisis? How will consumer behaviour change?

On work practices, the concept of working from home may well become more entrenched and more accepted across industries. Should this eventuate there is the proverbial Pandora’s Box of flow-on considerations, for instance the impact on demand for commercial property prices in CBDs if banks decide half the workforce can work from home.

From a workforce perspective, it may turn out to be a positive. Work-life balance is not always great and working from home may generate a better outcome in employees’ physical and mental health.

What is the latest article you have read on COVID-19 and what did you like about it?

I have a pretty broad reading list – recent articles from Chris Joye, Matt Taibbi, the Atlantic and the Economist have been interesting.

For me there are multiple takeaways. While there is a tendency to focus on the grim reality of where we are now, we will come through this – there is no doubt about that. It is more about the question of what society and the economy will look like in the medium term and what risks and opportunities this presents.

This crisis is different to all other crises we have faced in the past and this highlights health as integral to the social fabric. When you look at this holistically, the financial aspects that come off the back of the crisis are secondary, when you are of the belief your life is at risk

When you look at it from this context and consider the projections for global deaths are 250,000 or so on a best case scenario, there are potentially some substantial implications for society, consumer behaviour and international relations more generally. The consequences of these may be more profound than anything witnessed since the 1930s.