Automated teller machine deployments increased significantly last year in Central and Eastern Europe, but a slowdown in Russia pulled the overall growth rate down from the previous year, according to a report released this week by Retail Banking Research.

The London firm said banks and independent ATM operators in the region installed 169,003 machines in 15 Central and Eastern European countries last year, up 10.5% from the number of machines installed in 2008.

However, that growth rate was well below the 27.7% rise in 2008, when 152,905 ATMs were installed in the region, according to data compiled by Retail Banking Research.

ATM deployments in the region rose at a much higher rate than in Western Europe, where deployments grew by just 2.3% last year, according to Andrei Charniauski, a Retail Banking Research associate.

In 2008, banks and independent ATM operators in Russia and Ukraine drove the deployment growth. However, both countries saw slower growth rates in 2009.

Ukraine was the region's second-largest ATM market in 2009, with a total of 27,025 machines. This figure was up 2% from the year before, much slower growth than 2008, when deployments grew by 26.6%,

In Russia, the region's largest ATM market, ATM growth slowed considerably in 2009. This was largely because of financial and liquidity problems faced by the country's private banks, many of whose customers either were late repaying loans or refused to pay them altogether.

As a result, many private banks either stopped deploying ATMs or slowed their investments in bank infrastructure, though Russia's state-owned financial companies took up some of the slack, Charniauski said.

Russian banks last year deployed 11,405 ATMs for a total of 81,930 machines at the end of 2009.

While that's 16.2% more machines than at the end of 2008, the increase was far lower than the 19,375 new cash machines that were installed that year, Charniauski said.

Poland reported double-digit deployment growth in 2009, driven largely by independent sales organizations.

Last year, Polish banks and independent ATM operators deployed 15,595 machines, up 13.6% from the number of machines installed in 2008, Charniauski said.

In Western Europe, ATM installment growth has been slowing for several years, as banks have closed some branches and operators have removed ATMs that generate few transactions.

Banks and ATM network operators deployed 378,747 machines in the region last year, 2.3% more than in 2008.

The growth rate was 3.3% in 2008 and 5% in 2007, Charniauski said in a separate report released last month.