Foreign currency lending in emerging Europe: bank-level evidence
AbstractBased on survey data from 193 banks in 20 countries we provide the first bank-level analysis of the determinants of foreign currency (FX) lending in emerging Europe. We find that FX lending by all banks, regardless of their ownership structure, is strongly determined by the macroeconomic environment. We find no evidence of foreign banks ‘pushing’ FX loans indiscriminately because of easier access to wholesale funding in foreign currency. In fact, while foreign banks do lend more in FX to corporate clients, they do not do so to retail clients. We also find that after a take-over by a foreign bank, the acquired bank does not increase its FX lending any faster than a bank which remains in domestic hands.
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Bibliographic InfoPaper provided by European Bank for Reconstruction and Development, Office of the Chief Economist in its series Working Papers with number 122.
Length: 32 pages
Date of creation: Dec 2010
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Other versions of this item:
- Brown, M. & Haas, R. de, 2010. "Foreign Currency Lending in Emerging Europe: Bank Level Evidence," Discussion Paper 2010-135, Tilburg University, Center for Economic Research.
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- P2 - Economic Systems - - Socialist Systems and Transition Economies
- P5 - Economic Systems - - Comparative Economic Systems
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-02-05 (All new papers)
- NEP-BAN-2011-02-05 (Banking)
- NEP-EEC-2011-02-05 (European Economics)
- NEP-EFF-2011-02-05 (Efficiency & Productivity)
- NEP-FMK-2011-02-05 (Financial Markets)
- NEP-IFN-2011-02-05 (International Finance)
- NEP-MON-2011-02-05 (Monetary Economics)
- NEP-TRA-2011-02-05 (Transition Economics)
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