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The U.K.’s banking industry has the financial strength to withstand the coronavirus pandemic, even though the central bank projects credit losses of about 80 billion pounds ($99 billion) in its latest stress test.

The Bank of England said lenders could suffer impairments worth 3.5% of their loans to households and businesses by the end of 2021, if the economy deteriorates sharply. However, it emphasized that Britain’s banking system “is in a stronger position due to the regulatory reforms implemented after the 2008 financial crisis,” with enough capital to absorb losses and extra state support introduced during the pandemic to help borrowers and the economy.

The BOE and regulators around the world have raced to help banks withstand the financial strains of the virus outbreak by reducing capital requirements, delaying new rules and making it easier for employees to work from home while complying with rules.

Under the BOE’s stress test model published Thursday, corporate defaults could account for 19 billion pounds of losses despite a swath of government support programs, while consumer credit losses could spike and a 4 billion-pound hit from mortgage losses would be tempered by the payment holidays introduced in March.

Trading desks could face 7 billion pounds of losses under this stress scenario, although the BOE noted that banks’ trading books are much smaller now than they were in the 2008 crisis.

British lenders have already begun to brace themselves for the pandemic’s effects, last week setting aside billions of pounds to cover soured loans as the lockdown sends the U.K. economy into steep recession. They also warned of tough times ahead as the pandemic and its aftershocks cripple corporate clients in entire industries.

The test included Barclays Plc, HSBC Holdings Plc, Lloyds Banking Group Plc, Nationwide, Royal Bank of Scotland Group Plc, Santander UK and Standard Chartered Plc.

The central bank offered further relief on Thursday, announcing that it was cutting the capital requirement known as Pillar 2A to a “nominal amount” as volatility was making estimates difficult.