The Advent of Zombie Banks
3 Pages Posted: 3 Feb 2019
Date Written: January 20, 2019
The paper discusses the situation with the state of the heavily indebted economy in Cyprus and role that the remaining banks are playing which is to extract as much as possible from the collateral and guarantees they hold on bad loans. The Government is myopic in their approach which is to trust the banks to bring about an economic recovery. In the author's opinion this policy is more likely to sink the economy into a balance sheet recession.
Keywords: household dissaving, household debt, middle-class squeeze, tax evasion, debt write-offs
JEL Classification: E21, E69, G29, H26, H31
Suggested Citation: Suggested Citation