World Bank Sees East Europe Crunch Risk, Burns Tells Wiener

Western European banks’ deleveraging may make credit in eastern Europe scarcer, the World Bank’s Andrew Burns was quoted as saying in Austrian newspaper Wiener Zeitung.

“Europe’s banking sector needs to reduce risks, raise capital and increasingly set aside risk provisions,” Burns, who heads the World Bank’s global macroeconomics team, told the Vienna-based newspaper. “All of this could impact the credit provision to the private sector.”

“The problem is especially virulent in eastern Europe and central Asia because those countries strongly depend on loans from developed countries,” Burns added.

To contact the editor responsible for this story: Boris Groendahl at bgroendahl@bloomberg.net