Austria benefited from the 1991 fall of the Soviet Union in two ways. First, the country went from being a frontier state at the edge of the Iron Curtain to being the geographic center of the European Union's eastward expansion. At the same time, formerly communist countries in Central and Eastern Europe were beginning to open their markets to the world, creating the need for banking sectors that these countries had neither the expertise nor capital to create or maintain by themselves. Vienna saw this as an opportunity both for financial gain and to gain back some of the influence it possessed at the height of the Austro-Hungarian Empire. It used these historical ties in the region to greatly expand its financial presence in Central and Eastern Europe by participating in the privatization of formerly state-owned banks, opening its own banks in former Soviet satellites and providing direct cross-border loans. As a result of this process, Austrian banks today hold a market share of almost 20 percent in Central and Eastern European countries. Austrian banks' total international exposure in the first quarter of 2011 was 380 billion euros, or 134 percent of its GDP. In terms of GDP, Austria is more exposed than France (121 percent of GDP) but less than the United Kingdom (173 percent) or Switzerland (323 percent). Two-thirds of Austria's exposure is concentrated in Central and Eastern Europe, with its largest claims in the Czech Republic, Romania, Hungary, Croatia and Slovakia. Austria is not the only player in the region, either; Russia is gradually increasing its presence and trying to take advantage of the financial crisis in Europe by purchasing banks in its former Soviet area of influence.
