The confidence of investment funds in the Central European region has deteriorated between April and October at the quickest pace since the launch of the Deloitte Central Europe Private Equity Confidence Index bi-monthly report in 2003, according to a press release by Deloitte.
According to the company, investor confidence has increased at a sustained pace over the last two years and reached a post-crisis peak in the month of April. Later, concerns over a double recession and the uncertain future of the Eurozone, together with the slowdown of growth in Poland, Czech Republic and Slovakia have affected the optimism of investors, taking it to one of the lowest levels since the launch of the study.
Garret Byrne, Deloitte partner and leader of the M&A Transaction Services, comments: "When investors lose confidence, economies and businesses suffer. We have seen a steep and decisive shift in confidence, over the last six months. This suggests that the events of 2008 are still fresh in the mind of some of the investors and that any recovery which may have taken place over the last two years was extremely fragile". Hein van Dam, Coordinating Partner of Financial Advisory Services, Deloitte Balkans, added: "The conclusions of the latest study are not surprising, given the high economic uncertainty. However, the private equity industry has significant capital at its disposal, which is looking for placements; it is however to be expected that investments will become more prudent when it comes to assessing their objectives, as well as the cyclical nature of the industries that they are operating in".
C.P. (Translated by Cosmin Ghidoveanu)
* The main conclusions of the Deloitte Study
- Most of the respondents (66%) expect an overall worsening of the economic environment, compared to just 10%, six months ago;
- Similarly, 50% of them exp
