Abstract
A development in the banking market and bank credit oriented towards the private sector is a key factor for the economic development of the country. Before the appearance of the financial crisis of 2008, credit growth in the CESEE countries was double-digit, raising the concern of an excessive credit growth which could cause the economy to overheat. The global financial crisis significantly reduced bank credit rates to the private sector mainly as a result of the reduction in capital movements that parent banks made to their subsidiaries in the CESEE countries. The purpose of the paper is to convey how these reductions in credit rates caused effects on important economic variables such as economic growth, inflation, non-performing loans. We also try to see what the response of the monetary authorities was during the crisis, where some countries also faced inflationary pressures.
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