The paper gives a brief description of the evolution of the Finnish banking crisis and its handling. 1n the first section, the salient features of the Finnish banking system are described. We then briefly discuss the liberalization process, macroeconomic and regulatory policies, and the...

The paper is an update through early 1994 of a similarly titled paper (Bank of Finland Discussion Papers 8/93). It gives a brief description of the evolution of the Finnish banking crisis and its handling. In the first section, the salient features of the Finnish banking system are described. We...

Systemic bank problems arise for a large number of causes and in spite of both active banking supervision and market discipline. Once a problem has emerged, swift action is needed to limit further losses, avoid financial destabilization, and regain efficient markets.The restructuring exercise is...