CEE roundtable: Participants
How has the credit crunch affected your country?
KZ, Saidenov During the past few years commercial banks have been actively extending credits to the real sector of the economy. The main source of resources was external borrowing, which was the main way the crisis situation impinged on Kazakhstan’s economy.
The first signs of the crisis situation became evident in August 2007 when foreign investors started to withdraw their assets and commercial banks faced a liquidity deficit. In view of the limited access to external borrowing and the rise in its cost, in order to maintain the necessary level of liquidity Kazakhstan banks were forced to increase interest rates on the credits they extended and toughen lending conditions. This became the basic factor resulting in reduced access to credit.
So, between August and December 2007 the cost of credit increased by 5.6% and in the whole...
