5 Eastern European Banks Rise up to Back Their Economies

Business » FINANCE | March 4, 2009, Wednesday // 00:00| Views: | Comments: 0
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Bulgaria: 5 Eastern European Banks Rise up to Back Their Economies The Bulgarian National Banks also signed up to the joint declaration of another four Eastern European central banks that slammed as "simplified and misleading" reports the region's banks were in risk. Photo by BGNES

The central banks of five Eastern European countries, including Bulgaria, have slammed as "simplified and misleading" reports that the region's banks were at risk.

The supervisory authorities of the Czech Republic, Slovakia, Poland, Romania and Bulgaria issued a joint statement to express their concerns about the "publicly announced initiatives" warning about the risks banks in western EU members face due to high exposure in Central and Eastern European countries.

"The published information... is often simplified and misleading and could have negative impact on banks operating in these countries," said the statement, published on the Slovak central bank's website.

"Such self-fulfilling speculation totally disregards fundamental economic developments in the CEE countries and creates misperceptions that could inevitably be detrimental to both the CEE region and Europe as a whole," the statement said.

Hungary's central bank later said it supported the statement issued by it counterparts.

The statement did not specify what it meant by "publicly announced initiatives."

Last month, credit ratings agency Standard & Poor's said "all the ingredients for a crisis are in place" in Eastern Europe due to rising government debt and a heavy reliance on foreign lending.

Moody's also warned that economic conditions in the region would hit local subsidiaries of major western banks.

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