A more sustainable growth model is moving forward
In 2015 the economic environment for banks operating in Central and Eastern Europe (CEE) has been rather positive. Despite some exceptions, most countries in the region showed strong economic growth and resilience against shifts in investors' sentiment towards emerging markets, which was in good part related to their deep integration with the euro area and solid macroeconomic fundamentals. Banking sectors in most countries have remained profitable, although the overall level is normalizing compared to the pre-crisis period. These are some of the key findings of the latest CEE Banking Study, which was conducted by UniCredit´s CEE Strategic Analysis department and which covers 13 different countries. Looking forward, economic recovery is expected to further support lending, especially in countries which have been lagging behind so far. Non-performing loan ratios, which are currently high in various countries, should decline.
“east crossroads europe” is a magazine which presents facts, reports, analyses, background information and interviews, providing an overview of global economic, political and cultural developments.
Set up in 2004 and supported by UniCredit, the “east” review is a bimonthly publication in English and Italian. Each issue is dedicated to a special topic. “east” was originally conceived as a publication focusing on the European Union and Europe, with special attention being given to Central and Eastern Europe and its relationship with Asia, particularly China and India.
However, with the rapid progress of globalisation, and also in response to the financial crisis in the past years, the scope of “east” has been broadened to include the western part of the world.
Economic conditions in both markets are excellent. Initial estimates suggest that real GDP growth was 3.7% in Romania and 3.0% in Bulgaria in 2015. Both countries are expected to record even faster growth this year and next, with private consumption one of the principal drivers of GDP expansion. This should boost retail turnover and in turn give shopping centres a lift. Bucharest’s office market is expanding rapidly and new space is also coming onto the market in Sofia. These new offices are generally classified as category A. Also new logistics properties offer in an environment of low vacancy rates and stable rents potential for investors.