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Euro Membership, Foreign Banks And Credit Developments During The Financial Crisis In Slovakia: A Case Study

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  • Fidrmuc, Jarko
  • Wörgötter, Andreas

Abstract

Slovakia joined the euro area after a period of unprecedented real appreciation. The response to financial crisis combined internal devaluation with productivity increasing measures, including capital deepening in the banking sector. Although this strategy was successfully restoring an external equilibrium, the economy experienced a strong but short recession in 2009 which was driven by credit reductions. This development is compared with Estonia and Slovenia, two other small and very open economies, recently entering the euro area. The financial crisis reduced the financial integration gains in new euro member states in Central and Eastern Europe.

Suggested Citation

  • Fidrmuc, Jarko & Wörgötter, Andreas, 2014. "Euro Membership, Foreign Banks And Credit Developments During The Financial Crisis In Slovakia: A Case Study," Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 17(1), March.
    • Handle: RePEc:ags:roaaec:170471
    DOI: 10.22004/ag.econ.170471
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    1. Petr Koráb & Jitka Pomenkova, 2014. "Financial Crisis and Financing Constraints of SMEs in Visegrad Countries," WIFO Working Papers 485, WIFO.
    2. Petr Koráb & Jitka Poměnková, 2015. "Access to Credit of SMEs in the Czech Republic During the Financial Crisis and in the Post-crisis Period," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 63(4), pages 1297-1302.

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