Financial sectors in Baltic States still comparatively small relative to size of economy

Abstract

The financial systems of the Baltic States that joined the European Union in May are very bank-centred. In comparison to the old Member States, financial intermediation in these countries remains so far comparatively less developed, and despite strong growth in recent years, their banking sectors are still small relative to the size of the economy. Capital markets are at an early stage of development and their role in financial inter-mediation is still rather small.