Managing the banking crisis

The Finnish banking crisis of the 1990s and its management

The deep recession that hit Finland in the early 1990s undermined profitability across the entire financial sector and led to a banking crisis in autumn 1991. The authorities were forced to take special, and indeed exceptional, measures (takeovers, government assistance and temporary blanket guarantees to banks) to secure the stability of the financial system.

The Government has presented three reports to Parliament providing a more detailed description of the stages of the banking crisis and the steps taken by the authorities to organize an assistance package for the banks and overhaul the financial system:

- Government Communication to Parliament on the assistance package for the banks (2 December 1993).

- Government Communication to Parliament on the plan for overhauling the financial system and the means available, and on the return of government assistance to the public purse (14 May 1996). This included an appendix on the overhaul of the financial system containing background information from the Ministry of Finance.

- Government report to Parliament on the assistance package for the banks (16 November 1999).

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