Financial, monetary and banking integration of CESEE countries with the EU and the Euro area

This policy brief, based on Raguideau-Hannotin (2021), Raguideau-Hannotin (2023) and an unpublished work, summarizes (i) some empirical evidence on financial, monetary and banking integration of Central, Eastern and South Eastern European (CESEE) countries with the EU and the Euro area ; (ii) their impact on macroeconomic adjustement policies, particularly, monetary policy and private risk sharing. Nominal convergence, historical and geographical proximity with the EU, together with banking systems’ characteristics and integration are found to have critical effects. International integration to capital flows may play a role as well, as we find dilemma effects.