Canada’s banks are playing an important role in keeping households and businesses afloat during the COVID-19 pandemic, but fiscal programs will be key in helping the economy stay on track, according to the chief executive of Royal Bank of Canada.

“I think we have to look at this as a problem that nobody created,” Dave McKay told BNN Bloomberg’s Amanda Lang Wednesday. “Most small businesses, medium-sized businesses, and corporations – this is no fault of their own. They’re very well-run businesses. They were thriving in a strong economy.”

“This pandemic has happened to all of us,” he added.

As the novel coronavirus outbreak intensified, Canada’s Big Six banks have moved to offer lower interest rates on personal credit cards and mortgage deferrals, among other measures for clients who are facing financial hardship. McKay said his bank has fulfilled 250,000 requests to do with credit products so far, including mortgage deferrals. 

He added it is challenging for the bank to adjudicate loans and make credit decisions in an environment where many of RBC’s clients have no revenue.  

“That’s why you need fiscal programs, government-guaranteed plans. Forgivable loans are so important to allow us to move forward,” he said. “We can’t take an ever-expanding risk in our balance sheets without some sense of comfort that we’re bridging to progress in the future.”

“The taxpayer will recover this once the economy strengthens. That’s how we have to look at it.”