Mirza Nawazish, Rahat Birjees, Naqvi Bushra, Rizvi Syed Kumail Abbas
Excelia Business School, La Rochelle, France.
Lahore University of Management Sciences Lahore, Pakistan.
Q Rev Econ Finance. 2023 Feb;87:181-190. doi: 10.1016/j.qref.2020.09.002. Epub 2020 Sep 22.
The massive contagion of new coronavirus (Covid-19) has disrupted many businesses across the European Union. This has resulted in an immense drag on the revenues and cash flows that may lead to a significant increase in corporate bankruptcies. In this paper, we investigate the impact of Covid-19 on the solvency profile of the firms in the EU member states. We introduce multiple stress scenarios on the non-financial listed firms and report a progressive increase in the probability of default, an increase of debt payback, and declining coverages. Our results indicate that the solvency profile of all firms deteriorates. The manufacturing, mining, and retail sector are most vulnerable to a decline in market capitalization and a reduction in sales revenues. The paper also examines the possible policy interventions to sustain solvency at a pre Covid-19 level. Our findings suggest that for a moderate deterioration in economic conditions, a tax deferral is sufficient. However, in the event of exacerbating business shocks, there should be hybrid support through debt and equity to avoid a meltdown. This study has important implications for policymakers, corporate managers, and creditors.
新型冠状病毒（Covid-19）的大规模传播扰乱了欧盟各地的许多企业。这对收入和现金流造成了巨大拖累，可能导致企业破产大幅增加。在本文中，我们研究了Covid-19对欧盟成员国企业偿付能力状况的影响。我们对非金融上市公司引入了多种压力情景，并报告违约概率逐渐增加、债务偿还增加以及覆盖率下降。我们的结果表明，所有公司的偿付能力状况都在恶化。制造业、采矿业和零售部门最容易受到市值下降和销售收入减少的影响。本文还研究了将偿付能力维持在Covid-19之前水平的可能政策干预措施。我们的研究结果表明，对于经济状况的适度恶化，税收延期就足够了。然而，在商业冲击加剧的情况下，应该通过债务和股权提供混合支持，以避免崩溃。这项研究对政策制定者、企业经理和债权人具有重要意义。
