Four Scandinavian banks – DNB, SEB, Swedbank and Nordea – dominate the banking sectors of their Baltic neighbours. All come from non-euro countries, while two of the Baltic republics – Estonia and Latvia – have already adopted the euro and Lithuania is expected to follow suit in January 2015.
In some respects, this might work to the Baltic states’ advantage. Unlike in central and southeastern Europe, there are no fears of deleveraging as parent banks adjust their balance sheets in the run-up to the European Central Bank’s asset quality review later this year.
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Ingrida Simonyte, Bank of Lithuania |
It does, however, present a unique challenge for the region’s regulators.
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