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Economy and Banking Sector of Slovakia

Slovakia
Location
Central Europe
Population  (2017)
5 435 343  (0.00%)
EU Status
member since 2004
Currency
EUR (Euro)
Nominal GDP (2016)
81.0 bln EUR  (+0.04%)
Credit Ratings (as of Sep 2016)
A+/A2
Consolidated Banking Assets (2016)
73 051.11 mln EUR  (+8.46%)
Deposit Guarantee
100 000 EUR
Number of Banks
28

Located in Central Europe, Slovakia is a memberof the European Union since 2004 and of the Economic Monetary Union since 2009.

Slovakia is a high-income, developed economy with a high standard of living. Slovakia successfully transformed from a centrally planned economy to a market-driven economy.

The banking sector of Slovakia is highly concentrated and is dominated by foreign-controlled banks. Banks in Slovakia operate as universal banks.

List of Banks in Slovakia

National Currency

Euro (EUR)

Slovakia joined the Euro Area on 1 January 2009. The preceding national currency, Slovak koruna (SKK), was replaced by Euro.

GDP

Nominal GDP (2016)Nominal GDP per Capita (2016)Real GDP Growth (2016)
81.0 bln EUR  (+0.04%)14 900 EUR  (+0.03%)3.3 %  (2015: 3.6 %)

According to Eurostat, nominal GDP of Slovakia in 2016 was 81.0 bln EUR.

Slovakia outperforms the European Union in terms of real GDP growth with the average annual differential coming to 1.3% over the past 10 years (2006 - 2016). In 2016 real GDP growth was 3.3% which was above the Euro Area average (1.8%) and above the European Union average (1.9%). Real GDP growth in 2017 - 2022 are IMF's estimates.

Real GDP Growth in Slovakia.

Chart 1. Real GDP Growth in Slovakia. Source: Eurostat, International Monetary Fund.

In 2016, nominal GDP per capita in Slovakia was 14 900 EUR.

Slovakia has a below-average level of wealth in terms of per-capita GDP at purchasing power parity (PPP); this economic welfare indicator has, on average, fell behind that of the European Union by -17.2% over the past 10 years (2006 - 2016). GDP per capita at PPP in 2017 - 2022 are IMF's estimates.

GDP Per Capita at Purchasing Power Parity in  Slovakia; European Union = 100.

Chart 2. GDP Per Capita at Purchasing Power Parity in Slovakia; European Union = 100.

Inflation Rate

CPI, MoM (Sep 2017)CPI, YoY (Sep 2017)CPI, Year Average (2016)
0.2 %  (Aug 2017: 0.0 %)1.8 %  (Aug 2017: 1.6 %)-0.5 %  (2015: -0.3 %)

According to Eurostat, inflation rate in Slovakia in 2016 expressed as annual percentages of average consumer prices was -0.5% which was below the Euro Area average (0.2%) and below the European Union average (0.3%). Inflation rates in 2017 - 2022 are IMF's estimates.

Inflation Rate in Slovakia.

Chart 3. Inflation Rate in Slovakia. Source: Eurostat, International Monetary Fund.

Unemployment Rate

Unemployment Rate (2016)
9.7 %  (2015: 11.5 %)

Government Bond Yield

Government Bond Yield (Sep 2017)
0.82 %  (Aug 2017: 0.83 %)
According to Eurostat, government bond yield in Slovakia in Sep 2017 was 0.82%, compared to 0.83% in Aug 2017.
Government bond yield of Slovakia.

Chart 4. Government bond yield of Slovakia. Source: Eurostat.

Credit Ratings (as of Sep 2016)

Fitch Moody's
A+ (high credit quality), outlook stable A2 (upper medium grade), outlook stable

Double Taxation Agreements

Double Taxation Agreement (DTA) is an agreement between two or more countries for the avoidance of double taxation.

DTAs of Slovakia: 64 Signed Agreements

Slovakia signed DTAs which already came info force with the following jurisdictions (for agreements which came into force after 1 January 2013 the date of coming into force is given in brackets):

 Australia
 Austria
 Belarus
 Belgium
 Bosnia and Herzegovina
 Brazil
 Bulgaria
 Canada
 China
 Croatia
 Cyprus
 Czech Republic
 Denmark
 Estonia
 Finland
 France
 Georgia
 Germany
 Greece
 Hungary
 Iceland
 India
 Indonesia
 Ireland
 Israel
 Italy
 Japan
 Kazakhstan
 Korea, Republic of
 Kuwait (Apr 2014)
 Latvia
 Libya
 Lithuania
 Luxembourg
 Macedonia
 Malta
 Mexico
 Moldova, Republic of
 Montenegro
 Netherlands
 Nigeria
 Norway
 Poland
 Portugal
 Romania
 Russian Federation
 Serbia
 Singapore
 Slovenia
 South Africa
 Spain
 Sri Lanka
 Sweden
 Switzerland
 Syrian Arab Republic
 Tunisia
 Turkey
 Turkmenistan
 Ukraine
 United Kingdom
 United States
 Uzbekistan
 Vietnam

There are also several agreements between Slovakia and other jurisdictions which were signed but haven't yet come into force (for agreements signed after after 1 January 2013 of signing the agreement is given in brackets):

 Egypt

Information Exchange

There are 3 ways for jusrisdictions to exchange information on tax matters:

  • spontaneously;
  • on request;
  • automatically.

Spontaneous exchange of information is provision of information that is forseeably relevant to another party without a request being previously sent.

Tax Information Exchange Agreements (TIEAs) enable exchange of information on request relating to a specific tax investigation, either criminal or civil.

Automatic information exchange allows jurisdictions to exchange information automatically, without having a specific tax investigation.

Exchange on Request: 1 Signed Agreements

There are also several agreements between Slovakia and other jurisdictions which was signed but haven't yet come into force (for agreements signed after 1 January 2013 of signing the agreement is given in brackets):

 Guernsey (Oct 2013)

Automatic Exchange: No Commitment to Start

Slovakia didn't sign the automatic information exchange agreement and didn't indicate a timeline of the start of the automatic information exchange.

Automatic Excnange: 58 Bilateral Agreements to Receive Information

Slovakia has signed bilateral agreements with 58 jurisdictions to automatically receive information:

 Andorra
 Argentina
 Australia
 Austria
 Belgium
 Bonaire, Saint Eustatius and Saba
 Brazil
 Bulgaria
 Canada
 China
 Colombia
 Croatia
 Cyprus
 Czech Republic
 Denmark
 Estonia
 Faroe Islands
 Finland
 France
 Germany
 Gibraltar
 Greece
 Greenland
 Guernsey
 Hungary
 Iceland
 India
 Ireland
 Isle of Man
 Italy
 Japan
 Jersey
 Korea, Republic of
 Latvia
 Liechtenstein
 Lithuania
 Luxembourg
 Malaysia
 Malta
 Mauritius
 Mexico
 Monaco
 Netherlands
 New Zealand
 Norway
 Poland
 Portugal
 Romania
 San Marino
 Seychelles
 Singapore
 Slovenia
 South Africa
 Spain
 Sweden
 Switzerland
 United Kingdom
 Uruguay

Automatic Excnange: 67 Bilateral Agreements to Send Information

Slovakia has signed bilateral agreements with 67 jurisdictions to automatically send information:

 Andorra
 Anguilla
 Argentina
 Australia
 Austria
 Belgium
 Belize
 Bermuda
 Bonaire, Saint Eustatius and Saba
 Brazil
 British Virgin Islands
 Bulgaria
 Canada
 Cayman Islands
 China
 Colombia
 Costa Rica
 Croatia
 Cyprus
 Czech Republic
 Denmark
 Estonia
 Faroe Islands
 Finland
 France
 Germany
 Gibraltar
 Greece
 Greenland
 Guernsey
 Hungary
 Iceland
 India
 Indonesia
 Ireland
 Isle of Man
 Italy
 Japan
 Jersey
 Korea, Republic of
 Latvia
 Liechtenstein
 Lithuania
 Luxembourg
 Malaysia
 Malta
 Mauritius
 Mexico
 Monaco
 Montserrat
 Netherlands
 New Zealand
 Norway
 Poland
 Portugal
 Romania
 San Marino
 Seychelles
 Singapore
 Slovenia
 South Africa
 Spain
 Sweden
 Switzerland
 Turks and Caicos Islands
 United Kingdom
 Uruguay

Further Information

FATCA

Foreign Account Tax Compliance Act (FATCA) which became law in the United States in March 2010, focuses on reporting made by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest. The FATCA-reporting is facilitated by Intergovernmental Agreements (IGAs).

FATCA Status in Slovakia
IGA in effect since 31 July 2015, Model 1

Slovakia has FATCA agreement with the U.S. in effect since 31 July 2015 (Intergovernmental Agreement Model 1). Financial institutions operating in Slovakia are required to identify U.S. taxpayers by January 1, 2017 and to report the information for 2017 and the subsequent years. The agreement is reciprocal: Slovakian financial accounts hold in U.S. financial institutions will be reported to Slovakian authorities.

Further Information

Financial Market Development

Financial Market Development
4.6 (max 7.0), 32nd out of 138 countries
Banks' Soundness
5.9 (max 7.0), 15th out of 138 countries

According to World Economic Forum's Global Competitiveness Report 2017-2018, financial market development in Slovakia is scored 4.6 out of maximum 7.0 and ranked 32nd out of 138 analysed economies, trustworthiness and confidence of financial market is scored 5.0 (28th place).

Financial Market Development in Slovakia.

Chart 5. Financial Market Development in Slovakia. Source: WEF.


Soundness of banks is scored 5.9 bringing Slovakia into the 15th place.

Soundness of Banks in Slovakia.

Chart 6. Soundness of Banks in Slovakia. Source: WEF.

Further Information

Deposit Guarantee Scheme

Maximum Protected Amount
100 000 EUR

Deposit Guarantee Schemes compensate certain deposits held by depositors of a bank that becomes unable to meet its obligations.

From a depositor's point of view it is important to know:

  • if the depositor is eligible within the terms of the deposit guarantee scheme;
  • if the depositor's bank is a participant in the deposit guarantee scheme;
  • if the depositor's type of deposit is covered by the deposit guarantee scheme.

All these details about deposit guarantee scheme in Slovakia are summarised in Table 1.

Scheme Participantsall credit institutions operating in Slovakia, branches of Slovakian banks abroad
Scheme Exemptionsbranches of foreign banks (covered by their home countries)
Eligible Depositorsnatural persons, legal entities
Covered Accountsany credit balance
Maximum Protected Amount100 000 EUR
Paid In CurrencyEUR

Table 1. Deposit guarantee scheme in Slovakia.

Further Information

Country Ceiling for Deposits

Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.

Local Currency (Euro) Foreign Currency
Aaa (prime) Aaa (prime)

Local currency (Euro) deposit ceiling for Slovakia is set to Aaa (prime), foreign currency deposit ceiling is Aaa (prime).

Deposit Rates

Average Deposit Rate (Aug 2017, EUR)
0.55 %  (Jul 2017: 0.54 %)
In Aug 2017, an agreed annualised deposit rate in local currency (Euro) of new contracts with agreed maturity up to 1 year between credit institutions and households was 0.55% which was above the Euro Area average (0.36%).
Deposit Rates in Slovakia.

Chart 7. Deposit Rates in Slovakia. Source: ECB.

Further Information

Banking Sector Structure

Number of Banks
28
Consolidated Assets (2016)
73 051.11 mln EUR  (+8.46%)
Recent Changes (2016)
new banks: 2, closed banks: 0

Currently there are 28 credit institutions operating in Slovakia.

In 2016 consolidated banking assets in Slovakia were 73 051.11 mln EUR. The consolidated banking assets' evolution is shown at Chart 8 below.

Consolidated banking assets in Slovakia.

Chart 8. Consolidated banking assets in Slovakia.

Recent structural changes (2013 - 2016) of the banking sector of Slovakia are summarised in Table 2.

2013201420152016
Number of Opened Banks1002
Number of Closed Banks0010

Table 2. Recent structural changes in the banking sector of Slovakia.

The list of the most recently opened banks in Slovakia is provided in Table 3.

NameStart Date
 COFIDIS SA, pobočka zahraničnej banky (new)December 2016
 BNP PARIBAS PERSONAL FINANCE SA, pobočka zahraničnej banky (new)July 2016
 KDB Bank Europe Ltd., pobočka zahraničnej banky (new)August 2013
 

Table 3. The most recently opened banks in Slovakia.

All the credit institutions operating in Slovakia can be classified into several categories. Table 4 summarises the number of banks in each category.

CategoryNumber of Banks
Banks9
Branches of foreign banks15
Central banks1
Housing savings banks3

Table 4. Number of banks by category in Slovakia.

There are 15 branches of foreign banks from 9 different countries in Slovakia. Table 5 shows the number of branches grouped by the country of origin.

Country of OriginNumber of Branches
 Czech Republic5
 Austria2
 France2
 Belgium1
 Poland1
 Germany1
 Ireland1
 Netherlands1
 Hungary1

Table 5. Number of branches of foreign banks in Slovakia grouped by country of origin.

Major Banks of Slovakia

RankName
1 Slovenská sporiteľňa, a.s.
2 Všeobecná úverová banka, a.s.
3 Tatra banka, a.s.
4 Československá obchodná banka, a.s.
5 UniCredit Bank Czech Republic and Slovakia
6 Postova banka
7 Prima banka Slovensko, a.s.
 

Slovenska Sporitelna (Erste Bank)

Slovenská sporiteľňa traces its roots back to the 19th century when “affiliate branches of Die Erste Oesterreichische Spar-Casse” were established in several cities of Slovakia. Since 2001 Slovenská sporiteľňa is a member of Erste Bank Group (Austria). Slovenská sporiteľňa provide a full range of products and services to our clients, from traditional current accounts to various kinds of passbooks, term deposits, payment systems services, loans and modern electronic banking services.

Slovenska Sporitelna (Erste Bank) is rated by Fitch. Long-term credit rating assigned to the bank by Fitch is BBB+ (good credit quality). Slovenska Sporitelna (Erste Bank) participates in deposit guarantee scheme of Slovakia. This scheme covers accounts up to 100 000 EUR per bank per depositor.

VUB Banka (Intesa)

Všeobecná úverová banka (VUB Banka) is a universal bank, providing a wide range of retail, corporate and investment banking products and services to individuals, corporate and institutional clients. VUB Banka is focused on mortgages and consumer loans, deposit and payment products and services, corporate banking and foreign trade financing activities. Through its subsidiaries VUB Banka also offers leasing and factoring, retirement savings and insurance products.

VUB Banka (Intesa) is rated by Fitch, Moody's. Long-term credit rating assigned to the bank by Fitch is BBB (good credit quality). Long-term credit rating assigned to the bank by Moody's is A2 (upper medium grade). VUB Banka (Intesa) participates in deposit guarantee scheme of Slovakia. This scheme covers accounts up to 100 000 EUR per bank per depositor.

Tatra Banka (Raiffeisen)

Tatra Banka was established in 1990 and became the first private bank in Slovakia. Tatra Banka operates as a universal bank providing retail, private, corporate and investment banking prodocts and services to individuals, SMEs and other business entities.

Tatra Banka (Raiffeisen) is rated by Moody's. Long-term credit rating assigned to the bank by Moody's is Baa1 (lower medium grade). Tatra Banka (Raiffeisen) participates in deposit guarantee scheme of Slovakia. This scheme covers accounts up to 100 000 EUR per bank per depositor.

CSOB (KBC)

Československá obchodná banka (ČSOB Banka) is a universal commercial bank offering a full range of banking products to retail customers, small and medium-sized enterprises, corporate companies.

Business Focus
Private Banking
Corporate Banking

CSOB (KBC) is rated by Moody's. Long-term credit rating assigned to the bank by Moody's is Baa1 (lower medium grade). CSOB (KBC) participates in deposit guarantee scheme of Slovakia. This scheme covers accounts up to 100 000 EUR per bank per depositor.

UniCredit Bank Czech Republic and Slovakia

UniCredit is one of the largest European commercial banks. UniCredit is focused on providing financial products and services in Western and Central and Eastern Europe. UniCredit has 4 main business lines: commercial banking (including retail, direct, private and business banking), corporate and investment banking, asset management and asset gathering. UniCredit Bank Czech Republic and Slovakia operates as a branch of UniCredit Bank Czech Republic a. s. (Czech Republic).

UniCredit Bank Czech Republic and Slovakia participates in deposit guarantee scheme of the Czech Republic. This scheme covers accounts up to 100 000 EUR per bank per depositor.

Postova banka

Postova Banka was incorporated in 1992 and started its operations in 1993. Postova Banks provides a broad range of retail banking products and services to private individuals, SMEs and companies. In 2000, the Postova Banka signed a long-term agreement on mutual cooperation with Slovak Post and now provides selected banking products and services at the post offices under the common marketing concept.

Services
Retail Banking

Retail Banking Products

Postova banka participates in deposit guarantee scheme of Slovakia. This scheme covers accounts up to 100 000 EUR per bank per depositor.

Prima Banka (Penta Group)

Prima banka Slovensko was founded in 1993 to provide banking solutions to municipalities and public sector. Prima banka Slovensko operates as a universal bank providing retail and corporate banking products and services to private individuals, business entities and municipalities.

Prima Banka (Penta Group) participates in deposit guarantee scheme of Slovakia. This scheme covers accounts up to 100 000 EUR per bank per depositor.

Savings Accounts: 5 Offers from 1 Bank

Interest Rates: 0.30 - 0.30 % p.a.
Account Terms: 1 - 12 months

5 savings accounts offers from 1 bank operating in Slovakia are currently available. The savings accounts terms vary from 1 month to 1 years (12 months). The interest rates are within the range 0.30 - 0.30 %.

View All Offers
Highest Interest Rate Offer: Tagesgeld (Poštová banka, a.s.)
Interest Rate: 0.30 % p.a.
Account Term: 1 months

Postova Banka was incorporated in 1992 and started its operations in 1993. Postova Banks provides a broad range of retail banking products and services to private individuals, SMEs and companies. In 2000, the Postova Banka signed a long-term agreement on mutual cooperation with Slovak Post and now provides selected banking products and services at the post offices under the common marketing concept.

Time Deposit Accounts: 5 Offers from 1 Bank

Interest Rates: 1.00 - 1.40 % p.a.
Deposit Terms: 12 - 60 months

5 time deposit accounts offers from 1 bank operating in Slovakia are currently available. The time deposit accounts terms vary from 12 month to 5 years (60 months).The interest rates are within the range 1.00 - 1.40 %.

View All Offers
Highest Interest Rate Offer: Festgeld (Privatbanka, a.s.)
Interest Rate: 1.40 % p.a.
Deposit Term: 60 months

Privatbanka operates as a universal bank providing retail, private and corporate banking products and services to individuals and business customers. Privatbanka is the first bank in Slovakia specialising in private banking and asset management. Privatbanka offers its clients specialised financial and investment services tailored to their needs and expected returns on assets.