| Banking systems of the NMS are strongly linked to those of the EU15 Member States. Accession of NMS to EMU will likely to act, in the medium to long term, as a catalyst to strengthen already existing developments and trends in the banking systems of these countries. Accession to EMU will likely to strengthen the pressure for the reduction of existing excess capacity in the banking sector of the NMS. Further on, it is expected to put profitability under pressure and lead to increased geographical diversification and internationalisation, as well as to increased conglomeration and mergers and acquisitions. Overall, competition in banking within the euro area is likely to increase considerably after the NMS join EMU. When assessing any potential outcomes or... |
