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With a strong economic rebound anticipated for 2021, the outlook for the global investment bank sector is stable for the year ahead, according to Moody’s Investors Service.

The rating agency said that the big investment banks will head into the new year in a stronger position than many other segments of the economy.

“The [global investment banks] enter 2021 with strengthened capital and robust liquidity and funding,” said Ana Arsov, managing director of Moody’s financial institutions group, in a release.

“They’ve benefited from exceptional capital markets’ revenue that has countered the billions set aside for credit-loss provisions. They’re well-placed to deal with the uncertainties of the coming year that will pressure asset quality,” she added.

While those uncertainties linger, Moody’s said that the banks are poised to capitalize on an expected economic rebound in 2021.

The G20 advanced economies are expected to see 4.2% growth next year, following a 5.1% contraction in 2020, it noted.

In those markets, governments will provide continued fiscal support for the next several quarters, Moody’s said.

It expects that monetary policy “will remain highly accommodative” in the U.S., Canada, Europe and Japan, which helps “mitigate asset quality vulnerabilities.”

In 2020, the big banks enjoyed strong capital markets revenues, as issuance activity surged. “While these are expected to moderate during 2021, they should remain a significant revenue driver,” Moody’s said.

At the same time, merger and acquisition activity, which was “sluggish during most of 2020,” is expected to rebound in 2021, Moodys said.

Ultra low interest rates and uncertainty about the trajectory of the pandemic will continue to weigh on the banks in the year ahead, it cautioned.