BANKING SECTOR AND RESTRUCTURING IN EASTERN-EUROPE

The paper seeks to achieve a number of objectives. First, to analyze the underlying causes of East European commercial banks' illiquidity problems. Second, to examine the case for public versus private (informal) approaches to bankruptcy and bank restructurings as general approaches to these problems. Third, to evaluate the different models of restructuring banks (in particular eight alternative models are identified). Fourth, to briefly describe the models that have been chosen by a number of East European countries. Finally, to layout the criteria for policymakers choice of a particular restructuring model.