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N° 2009-33 |
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| December 2009 |
| Assessing the Sustainability of Credit Growth: the Case of Central and Eastern European Countries |
Virginie Coudert
Cyril Pouvelle |
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| Strong credit growth rates in transition countries may result from a normal catching-up
process in a framework of financial development. However, as elsewhere, they can also
pertain to a “credit boom”, paving the way to future “credit crunches”. We try to disentangle
these two types of situation for the central and eastern European countries (CEECs) by
applying a number of methods. First, we consider the gap between current credit and its longterm
trend and we find some signs of credit booms, in several CEECs in 2005-2007. Second,
we assess the “normal” growth of credit with regard to fundamentals through econometric
estimations. Credit growth is also shown to have been excessive in several countries just
before the 2008-2009 financial crisis. |
Non-technical summary  |
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Résumé
non-technique
en français |
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| Full text |
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| Credit boom; transition; financial development |
Keywords |
| E30; E51; G21 |
JEL classification |
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