Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/212625 
Year of Publication: 
2008
Series/Report no.: 
BOFIT Discussion Papers No. 12/2008
Publisher: 
Bank of Finland, Institute for Economies in Transition (BOFIT), Helsinki
Abstract: 
Modern banking institutions were virtually non-existent in the planned economies of cen-tral Europe and the former Soviet Union. In the early transition period, banking sectors began to develop during several years of macroeconomic decline and turbulence accompa-nied by repeated bank crises. However, governments in many transition countries learned from these tumultuous experiences and eventually dealt successfully with the accumulated bad loans and lack of strong bank regulation. In addition, rapid progress in bank privatiza-tion and consolidation took place in the late 1990s and early 2000s, usually with the partic-ipation of foreign banks. By 2005, the banking sectors in many transition countries had developed sufficiently to provide a wide range of services with solid bank performance. Recently, banks have switched their focus from lending to enterprises in a somewhat un-derdeveloped institutional environment to new collateralized lending to households, which accounts for much of the recent growth of credit in many transition countries.
Subjects: 
transition banking
bank privatization
foreign banks
bank regulation
credit growth
JEL: 
G21
P30
P34
P52
Persistent Identifier of the first edition: 
ISBN: 
978-952-462-915-7
Document Type: 
Working Paper

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