Eastern European banks face turmoil
TEXT OF STORY
Bill Radke: European bank shares are being hit again because of the economic turmoil happening in Eastern Europe. From London, Stephen Beard has that.
Stephen Beard: Some analysts warn that Eastern Europe is on the brink of economic collapse, like the Asian meltdown a decade ago.
During the recent boom in Europe, western banks poured more than a trillion dollars into the eastern part of the continent. But now strapped for cash, they’re pulling out. Foreign bank lending has slowed to a trickle. East European currencies are sliding fast. The Hungarian forint and the Polish zloty have slumped. The solvency of some governments is in question.
Graham Mather is with the European Policy Forum:
Graham Mather: Markets are undoubtedly now concerned that some governments aren’t going to be able to pay their debts. And that is going to have real economic effects in Eastern Europe.
Every East European economy is expected to shrink this year, some by more than 10 percent. As a result, some of West Europe’s biggest banks could face further heavy losses.
In London, this is Stephen Beard for Marketplace.
Stories You Might Like
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
