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333:, was established and divided among loan-making banks. The largest recipients were the savings bank group Suomen Säästöpankki and Säästöpankkien keskusosakepankki (SKOP), a bank owned by small local savings banks. The remaining banks also received financial support. The savings bank group was liquidated and divided among the
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throughout the 1980s that dragged on and "overheated" the economy, leading to the corrective contraction of the depression. One reason was a change in
Finnish banking laws in 1986 to allow Finnish companies to seek credit more easily from foreign banks, which was considerably less expensive than
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created an environment in which large short-term profits were posted, leading to an artificially-inflated appearance of great wealth in the economy. The term "casino economy" was used to describe the use of loans to get very rich very quickly on paper by exploiting those bubbles.
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in 1991 the debts taken by the
Finnish banks. To help the export industry, Finland performed devaluations in 1991 and 1992 and so entrepreneurs who had taken foreign currency loans found themselves in a financially-disadvantageous position.
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rose greatly, and the bankruptcies and the weak economy caused mass unemployment. Unemployment from 1992 to 1997 was consistently over 12% and went as high as 36.7% in construction industry during year 1994. Smaller banks ended up
371:, and each nation's economic difficulty had a reverberating effect for the others. In other parts of the world, the economy grew as normal, and Finland indeed recovered quite fast, especially with
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A market "bubble" was created by the paper industry in
Finland in the late 1980s, the collapse of which was a contributor to the 1990s recession. This picture shows a paper factory in
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that occurred in
November 1991 increased the debts of Finnish companies holding foreign loans in foreign currencies. They did not properly scale with the devaluation that the
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had shown as early as in 1974. It was not followed in
Finland in connection with the freeing of money market. However, foreign currency loans were only 15% of all loans.
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weakened the international competitiveness of
Finnish industry. In particular, much of the Finnish economy was reliant on the paper industry, which also experienced
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by larger banks because they had difficulty maintaining profitability as a result of risky loans made to companies that went bankrupt, resulting in a nationwide
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also played an important role, as it had represented 15–20% of
Finland's foreign trade. Thus, a key Finnish export market disappeared nearly overnight. The
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throughout the 1990s, especially in terms of employment but also in culture, politics and the general sociopolitical atmosphere. The
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Finnish domestic credit. That led to a large-scale search for foreign loan sources, which helped to undermine the strength of the
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Since then, despite an overall recovery, unemployment has been persistent, and
Finland has never returned to the state of nearly
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The
Finnish economy began to gradually recover in the mid-1990s. The depression of the early 1990s was mainly localised in the
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National government and municipal spending were strongly cut to guarantee the liquidity of the country. That weakened
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measures, which had restricted government expenditures even for a period after the depression had formally ended.
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and
Yhdyspankki. In 1994, KOP had to merge with Yhdyspankki to form Merita Bank, which was later merged with
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of the banking system of Finland weakened as a consequence of the bank crisis. The government answered it by
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fell in both the public and the private sector as a consequence of the depression. The number of company
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of the state of Finland was several percentage points of the GNP. Furthermore, Finland's
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This article is about the 1991–93 recession in Finland. For the worldwide impact, see
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after Finland's local financial matters had been settled. The guiding star was the
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and the increase of car use in Finland had also raised the level of the
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Furthermore, political decisions based on the strength of the
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served as the Prime Minister of Finland after the depression.
451:"Lamasta noustaan – vaikkei käännettä aina heti huomatakaan"
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The depression of 1991–1993 had a deep effect on the
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425:"Työmarkkinoiden toimintamuutosten analysointi"
356:and other things. In 1995, then-prime minister
140:'s history, even worse there than the 1930s
196:of the 1980s. Finland experienced a strong
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166:that had existed before the crisis.
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65:"Early 1990s depression in Finland"
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414:J. C. Conesa, T. J. Kehoe, 2007.
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490:. Retrieved
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48:Please help
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343:Postipankki
331:OHY Arsenal
281:bank crisis
264:Consumption
255:worldwide.
215:devaluation
506:Categories
492:2014-08-08
461:2014-08-08
435:2014-08-08
403:References
268:investment
174:See also:
76:newspapers
362:austerity
315:liquidity
240:with the
213:The huge
186:Jakobstad
386:See also
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259:Results
138:Finland
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486:(PDF)
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