The current financial turmoil raises concerns about supportiveness of foreign banks from Western European countries for their Central and Eastern European subsidiaries. Foreign bank presence dominates banking business in almost all countries in the region, which would make their withdrawal very painful, if not catastrophic. For Austrian and Swedish banks, this region was a source of large profits in the last years, and, therefore, they are expected to stay in the region. While recognizing individual strengths and weaknesses of each country, such strong interconnectedness calls for a region wide approach for helping ailing banks.

 Keywords : CEECS | BANKING SYSTEM | FDI

 JEL : G21

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