the unprecedented health emergency, the focus of public policies – in albania and globally - was the undertaking of severe social distancing measures. naturally, these measures have hit the economic activity and have demanded for a comprehensive easing of fiscal, monetary and financial policies. 1 / 4 bis central bankers'speeches fiscal policy – rightfully - has been given a primary role in facing the situation. this policy may provide a direct support to aggregate demand, through fiscal transfers, and an immediate and targeted improvement of liquidity to enterprises, through the postponing of the payment of taxes and through the sovereign guarantees programs. the two introduced fiscal packages, so far, provide for a maximum potential stimulus at around 3 % of gdp. even without considering the negative effect on public income, this stimulus transfers to the balance sheet of public sector a considerable part of the financial costs of the crisis. on its side, the bank of albania has increased the dosage of the monetary stimulus. this stimulus has been taken the form of the reduction of policy rate, already in its historical minimum of 0. 5 %, aiming to boost lending and reduce the servicing cost of existing loans. also, it has been in the form of removing the quantitative limits of liquidity injection into the system, aiming to a better supply of the banking market and the albanian economy. the volume of liquidity that we inject every week in the system fluctuates around the level 2 %. in addition, the bank of albania has undertaken operational measures for guaranteeing the supply of economy with cash, in response to its increased demands. in parallel, the bank of albania – in an agreement and good understanding with banking industry – has carried out regulatory amendments which ease the postponing with one quarter of the credit payment for firms and households which face temporary financial difficulties. the reports, so far, show that more than 20. 000 firms have benefited from this easing, who have a credit at banks which account for higher than eur 2 billion. also, we have temporary suspended the allocation of dividend by the banking sector, for the purpose of strengthening the capitalisation indicators of this sector. dear guests, the reaction philosophy of the bank of albania is the mitigation of crisis consequences and the establishment of preconditions for a rapid recovery of the economy once the pandemic is overcome. in detailing this philosophy, we deem that : the safeguarding of the monetary and financial stability, and the minimisation of the negative effects of pan

##demic on our production capacities, are two crucial preconditions for the recovery. for this reason, the objective of our policies is the application of the right stimuli in timely manner, without prejudice in any moment to the monetary and financial stability of albania. i am confident that both business community and the banking sector share this philosophy. 2. business and banking sector in face of covid - 19 as i already emphasised, the albanian business is facing a serious challenge to its future. this challenge has almost existential dimensions in certain segments. at the same time, the longterm soundness of banking sector is closely related with the soundness of business. banking credit to firms is almost 4 times higher during the last two decades. it accounts for around 25 % of banks ’ balance sheets and has a comparable share to gdp, while the bank – business relationships ’ flow is present also in the field of other financial products and in the payment services. for this reason, your reaction against the shock should be decisive, courageous and visionary, as well as based on the spirit of collaboration and common long - term interests. allow me to be more concrete in detailing the vision of the bank of albania on the challenges ahead. the first challenge is the facing of health emergency. the business and banking sector should 2 / 4 bis central bankers'speeches be clear that human capital is the most precious asset for every company. for this reason, any necessary measure to guarantee the health of the employees should not be considered as an expense, but as a strategic investment for the future of the firm. the second challenge is the revision of the business model and the increase of operational flexibility. one of the lessons of this crisis is that each of us can make more to adopt the information technology, to shift part of the business on line, and to increase the operational flexibility and efficiency. putting into practice these lessons is particularly useful in case of the prolongation of the pandemic. the third challenge is maintaining liquidity and solvency of firms. the shock we are suffering found the albanian business with a high historical level of liquidity ; its deposits with banks accounted for around 12 % of gdp in the first quarter. in parallel, business access to banking liquid funds, in the form of overdrafts or lines of credit, is at a comparable size with the deposits of the business itself. this liquidity is a reasonable security restrain to risk. nevertheless, the historical experience shows that liquidity crises frequently are the