Makes sense.
I always wondered how that loan demand was accommodated.
Never looked like the kind of lending US regulators would sanction.
Karim writes:
Interesting table from JPM.
Much larger dependence on credit from Eur banks for LATAM economies than from U.S. banks.
Poland/Russia not as surprising but still large!
Overall, domestic bank lending surveys in EM have also been moving towards a net tightening of lending standards.
Could be more severe credit contraction in those economies as a result of ongoing strains in Europe.
| Euro area and US bank claims on EM | ||||
|---|---|---|---|---|
| As of 2Q11 | ||||
| EM | ||||
| EM Asia | ||||
| China | ||||
| Korea | ||||
| Latam | ||||
| Brazil | ||||
| Russia | ||||
| Poland | ||||