European banks also cut lending to emerging markets. Their consolidated foreign claims on emerging Europe, Latin America and Asia had already started to fall in the third quarter of 2011 (see pages 18–20 of the Highlights). New syndicated and large bilateral loans from EU banking groups to emerging market borrowers then fell in the final quarter of the year. This was in contrast to lending to western Europe and other developed countries, which was essentially unchanged (Graph 8). At the same time, banks tightened terms on new loans to corporations and households in emerging markets (Graph 6, left- hand panel). The.
