At long last, the message is getting across that, as far as the financial crisis is concerned, it makes no sense to view the ex-communist countries of central and eastern Europe as one homogenous bloc. European Union policymakers, both in Brussels and at national level, have been trying to make this point for some months. Only now, perhaps, is it really sinking home.
For example, a report by Moody’s credit ratings agency on Tuesday drew a clear distinction between various countries in the region. Some, such as Hungary, rashly allowed a huge expansion in credit in recent years, much in the form of foreign currency-denominated mortgage loans. Others, such as the Czech Republic, did not. The first group is more vulnerable, even if much will ultimately depend on the willingness of western European banks to continue supplying funds to the regional banks they own. Read more