DETERMINANTS OF BANK PERFORMANCE IN CEE COUNTRIES

In this paper examine the impact of the current financial crisis on the performance

of banks across 19 countries from Central and Eastern European for the period 2004 – 2010.

The period chosen is relevant in the context of the entrance of new ten EU members at the

beginning of the year 2004 and the beginning signs of the subprime crisis in the Central and

Eastern Europe in 2008. Also, we highlight the differences between different groups of

countries: member of European Union or non-member of Euro Union.The results show large

differences between pre-crisis period and crisis period and among the banking systems in

terms of performance indicators. In average, banks from countries that are not members of

European Union recorded an ample decrease of profitability and stability during current

financial crisis. We observe that the best-performing banks during current financial crisis had

significantly more core equity capital and are more focus on traditional banking activities.