European banks may suffer over $900b of losses

A financial report has found European banks could face losses of up to 800 billion euros ($915 billion) and a 30 billion euro hit to their revenues during the next three years as a result of the coronavirus crisis.

According to the report published by consultancy Oliver Wyman, bad debts would surge to 400 billion euros, about two and a half times the level for the previous three years.

If there was a second wave of the virus that forced another lockdown across Europe, then that figure could double, it said.

The forecast comes as European Union leaders reached an agreement on a long-awaited recovery fund to boost their national economies after the pandemic.

Christian Edelmann, co-head of European financial services at Oliver Wyman, said the pandemic is "unlikely to cripple the European banking sector", but added that it will force many banks into a "limbo state" with weak returns.

But, to put it in context, the consultancy highlighted that the expected scenario, if most countries avoid a second lockdown, would still only see losses less than 40 percent of those experienced during the global financial crisis of 2008. Similar losses were experienced during the eurozone crisis of 2012 to 2014.

Stock markets will have been boosted by news that a novel coronavirus vaccine developed by the University of Oxford in the United Kingdom appears safe and triggers an immune response. Trials involving 1,077 people showed the injection led to them making antibodies and T-cells that can fight the virus.

Larger trials under way

But researchers said it is still too soon to know if this is enough to offer protection and larger trials are under way. The UK has already ordered 100 million doses of the vaccine. Latest figures show 56,100 deaths related to COVID-19 have been registered in the country.

It has emerged that the UK's National Health Service was deprived of large amounts of protective gear at the height of the virus outbreak after a French company contracted to supply millions of masks allegedly prioritized more lucrative deals.

The Guardian newspaper and the French news website Mediapart have uncovered evidence suggesting the mask manufacturer Valmy failed to fulfill the terms of a 1.2-million-pound contract with the NHS to supply about 7 million masks in the event of a pandemic.

France has now made face masks compulsory in all enclosed public spaces amid a fresh bout of COVID-19 outbreaks.

Health Minister Oliver Veran warned that France had between "400 and 500 active clusters" of the virus.

In Ireland, a contact tracing app designed to combat local outbreaks of the virus is proving to be a success.

After its launch on July 6, the Covid Tracker app was downloaded 1.3 million times over the following eight days－the fastest rate per capita for an app in Europe－and has started picking up cases of infection.