Thursday, October 11, 2007

Bank of Latvia is becoming worried...

about the state of the credit market. As I wrote a few days ago, Latvian banks have cut the amount of home loans that they issue by a half in last few months.

The chairman of Bank of Latvia, Ilmars Rimsevics, just said the following:
  • Bank of Latvia is watching the slowdown in new credits;
  • If the slowdown is too fast, it may damage the Latvian economy;
  • In that case, Bank of Latvia may consider relaxing the restrictions on new lending.
With the economy being as dependent on foreign credits as in Latvia, it's hard to figure a good way out...

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