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A Re-assessment of Credit Development in European Transition Economies


  • Zdzienicka, Aleksandra


The aim of the paper is to re-assess the bank credit development in 11 Central and Eastern European countries and to provide new estimates of the credit-to-GDP ratio equilibrium level. Using filtering methods and dynamic panel estimations, our results suggest an “excessive” credit development for most of the studied economies until 2007. After this period, while credit has continued to remain excessive in Bulgaria, Hungary, Poland and Slovakia, it has decelerated in the other countries. However, while the results suggest a possibility of “credit crunch” in the Baltic republics and, to a less extent, in Croatia, credit deceleration may lead to “soft landing” for the Czech Republic, Romania and Slovenia.

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  • Zdzienicka, Aleksandra, 2010. "A Re-assessment of Credit Development in European Transition Economies," MPRA Paper 22692, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:22692

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    Cited by:

    1. Iwanicz-Drozdowska, Małgorzata & Witkowski, Bartosz, 2016. "Credit growth in Central, Eastern, and South-Eastern Europe: The case of foreign bank subsidiaries," International Review of Financial Analysis, Elsevier, vol. 43(C), pages 146-158.

    More about this item


    Bank Credit; Dynamic Panel; CEECs;

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables

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