Emerging European Banks Face Mixed Fortunes

Our outlook for the emerging Europe banking sector is mixed, reflecting the divergent growth trajectories that we forecast for the region. We believe that the ongoing, domestic demand-led, recoveries in Turkey and Poland provide favourable conditions for banks to extend lending and profitably tap relatively undeveloped consumer markets. In contrast, banks operating in regional laggards such as Hungary and Romania are likely to face further loan book deterioration and limited short-term lending opportunities.

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