World Bank2013-09-272013-09-272012-06https://hdl.handle.net/10986/15911Latvia has a well-developed financial sector, but in the aftermath of the 2008-09 global financial crisis, access to finance has become a major constraint for the development of private enterprises. Credit to the private sector in Latvia, at above 100 percent of Gross Domestic Product, or GDP, is one of the highest in Eastern Europe, after significant growth over the last decade. However, in the aftermath of the 2008-09 financial crisis, credit growth has been negative (average annual growth of -7 percent between FY2009-2011) and access to finance has become one of the most significant obstacles for growth according to enterprises (close to 30 percent of firms identify it as an obstacle in 2009, versus 2 percent before the crisis). This contributed to a significant decline in the volume of private investment, which dropped by 48 percent between 2008 and 2010. Credit constraints are more severe in specific segments, including smaller firms. In response to these challenges, the Government has supported credit to the private sector through various instruments, some of which may need to be reviewed. Support has been provided through various financial instruments aimed at enhancing the accessibility and affordability of credit and implemented trough public bodies and commercial financial intermediaries. It will also be important to ensure the programs create adequate incentives for financial intermediaries to expand services to underserved markets in a sustainable manner, and that the programs lever the established capacity and expertise of robust commercial lenders, minimizing competition with such lenders.en-USCC BY 3.0 IGOACCESS TO FINANCINGACCOUNTINGACCOUNTS RECEIVABLEAMOUNT OF CAPITALARBITRATIONARREARSAUCTIONAUCTIONSAVAILABILITY OF BANK FINANCINGBAILIFFBAILIFFSBANK ACCOUNTSBANK BONDSBANK CREDITBANK GUARANTEEBANK LENDERSBANK LENDINGBANK LOANSBANKING SECTORBANKING SYSTEMBENEFICIARIESBONDBOND MARKETSBONDSBROKERAGECAPITAL ADEQUACYCAPITAL GAINSCAPITAL INVESTMENTSCAPITAL MARKETCAPITAL MARKETSCAPITALIZATIONCASH FLOWCASH MANAGEMENTCENTRAL BANKCENTRAL BANKSCENTRAL DEPOSITORYCENTRAL SECURITIES DEPOSITORYCHECKING ACCOUNTCOLLATERALCOLLATERAL REQUIREMENTSCOLLATERALIZATIONCOMMERCIAL BANKSCOMMERCIAL CREDITCOMMERCIAL LAWCOMMERCIAL PLEDGECOMMERCIAL PLEDGESCOMMERCIAL TERMSCONSUMER PROTECTIONCORPORATE BONDSCORPORATE GOVERNANCECREDIBILITYCREDIT APPRAISALCREDIT CONSTRAINTSCREDIT DECISIONSCREDIT GROWTHCREDIT GUARANTEECREDIT GUARANTEESCREDIT HISTORYCREDIT INFORMATIONCREDIT INFORMATION REGISTRYCREDIT INSTITUTIONSCREDIT MARKETCREDIT SCORINGCREDIT UNIONCREDIT UNIONSCREDITORCREDITOR RIGHTSCREDITORSCREDITWORTHINESSCURRENCYCURRENCY BOARDCURRENCY RISKDEBTDEBT ISSUANCEDEBTORDEBTORSDEBTSDEEDDEEDSDEMAND FOR CREDITDEPOSITDEPOSIT INSURANCEDEPOSITORDEPOSITORSDEPOSITSDOMESTIC BONDSDOMESTIC CAPITALDOMESTIC CAPITAL MARKETDOMESTIC CAPITAL MARKETSDOMESTIC MARKETDUE DILIGENCEENFORCEMENT PROCESSESEQUIPMENTEQUITY FINANCINGEQUITY INSTRUMENTSEXCHANGE RATEEXPORT GROWTHEXPORTERSFINANCIAL CRISISFINANCIAL INSTITUTIONFINANCIAL INSTITUTIONSFINANCIAL INSTRUMENTSFINANCIAL MARKETSFINANCIAL SECTOR DEVELOPMENTFIXED ASSETFIXED INCOMEFIXED INCOME PORTFOLIOFORECLOSUREFOREIGN BANKFOREIGN BANKSFOREIGN FINANCINGFOREIGN INVESTORSFRAUDFUND MANAGERSGOVERNMENT SUPPORTHOST COUNTRIESIMMOVABLE ASSETSINDIVIDUAL INVESTORSINSTITUTIONAL CAPACITYINSTITUTIONAL INVESTORINSTITUTIONAL INVESTORSINSURANCE COMPANIESINTEREST RATESINTERNATIONAL CREDITINVESTINGINVESTMENT FUNDINVESTMENT FUNDSINVESTMENT REGULATIONINVESTOR BASEISSUANCESLACK OF COLLATERALLEGAL ENVIRONMENTLEGAL FRAMEWORKLEGAL PROTECTIONLEGAL REFORMSLEGAL SYSTEMLENDERSLINE OF CREDITLIQUIDATIONLIQUIDATIONSLOANLOAN AMOUNTLOAN APPLICATIONSLOAN GUARANTEELOAN PORTFOLIOLOAN PORTFOLIOSLOAN SIZELOCAL BANKLOCAL CURRENCYLOCAL DEBTLOCAL MARKETLONG-TERM CAPITALMARKET CONDITIONSMARKET CONFIDENCEMARKET DISTORTIONSMARKET INFRASTRUCTUREMARKET LIQUIDITYMARKET PARTICIPANTSMARKET SHAREMATURITIESMICRO ENTERPRISEMICRO ENTERPRISESMICROENTERPRISESMICROFINANCEMICROFINANCE INSTITUTIONSMONEY LENDERSMONEYLENDERSMORTGAGEMOVABLE ASSETSNON-PERFORMING LOANSNPLOPEN ECONOMYPARTIAL CREDITPAYMENT SYSTEMPAYMENT SYSTEMSPENSIONPENSION FUNDPENSION FUNDSPENSION SYSTEMPERSONAL GUARANTEESPORTFOLIOPORTFOLIO VALUATIONPRIVATE BANKSPRIVATE CREDITPRIVATE CREDIT BUREAUPRIVATE CREDIT BUREAUSPRIVATE EQUITYPRIVATE FINANCIAL INSTITUTIONSPRIVATE INVESTMENTPRIVATE LENDERSPRIVATE PROPERTYPROPERTY RIGHTSPUBLIC FUNDSPUBLIC REGISTRYREGISTRATION SYSTEMREGULATORY FRAMEWORKRELIANCE ON COLLATERALREPOSSESSIONRESERVESRESIDENTIAL MORTGAGESRETURNRETURN ON ASSETSRETURNSRISK AVERSIONRISK MANAGEMENTRISK OF DEFAULTSECURITIESSECURITIES LAWSECURITIES LAWSSECURITY INTERESTSECURITY INTERESTSSETTLEMENTSETTLEMENT SYSTEMSSHORT MATURITYSMALL BUSINESSSOVEREIGN RATINGSTATE BANKSSTOCK EXCHANGESTOCK EXCHANGESSTOCK MARKETSTOCK MARKETSSTOCKSSTRATEGIC INVESTORSSUPPLY OF CREDITTAXTAX REGIMETERRORISMTRADE CREDITTRADINGTRANSACTIONTRANSPARENCYTURNOVERVARIABLE RATESWITHDRAWALWORKING CAPITALWorld Bank10.1596/15911