Central and eastern Europe focused lenders are keen to see more CEE countries join the eurozone, despite its public debt problems. Loan bankers in the region are looking forward to the prospect of more markets opening up, and to saying farewell to a few more small illiquid local currencies that they don’t want to lend in.
It looks like the banks may get their way. Latvia and Lithuania have made it clear that they want to follow in Estonia’s footsteps and join the eurozone. This could happen as early as 2014.
But among the dissenters, Polish central bank governor Marek Belka has publicly voiced concerns about joining the euro. He has very sensibly said that his country will join when the eurozone has got its house in order.
In the meantime, corporate borrowers can be assured their funding will not be hampered by retaining the local currencies.
Polish communications company Polsat has an extremely popular loan in syndication and many European loan bankers say that TPSA’s zloty transaction was one of the best deals of last year. International lenders would be very happy if all the countries in central and eastern Europe managed to join the euro en masse but in the meantime they will continue to finance the right names in non-euro markets.