Economy and Banking Sector of Slovenia

Location Southeastern Europe
Population (2016)2 064 188 ↑ (0.00%)
EU Status member since 2004
Economy
National Currency EUR (Euro) since 1 January 2007
GDP 
    Nominal GDP (2015)38.5 bln EUR ↑ (+0.03%)
    Nominal GDP per Capita (2015)18 700 EUR ↑ (+0.03%)
    Real GDP Growth (2015)2.9 % ↑ (2014: 2.6 %)
Inflation Rate 
    CPI, MoM (Sep 2016)0.3 % ↑ (Aug 2016: -0.1 %)
    CPI, YoY (Sep 2016)0.2 % ↑ (Aug 2016: -0.2 %)
    CPI, Year Average (2015)-0.8 % ↓ (2014: 0.4 %)
Unemployment Rate (2015)9.0 % ↓ (2014: 9.8 %)
Government Bond Yield (Sep 2016)0.75 % ↓ (Aug 2016: 0.80 %)
Credit Ratings (as of Sep 2016)
    FitchBBB+ good credit quality, outlook positive
    Moody'sBaa3 lower medium grade, outlook stable
    S&PA upper medium grade
Taxation
Double Taxation Agreements 57 signed agreements
Information Exchange 
    Exchange on Request 3 signed agreements
    Automatic Exchange starts in September 2017
FATCA IGA in effect since 02 June 2014, Model 1
Banking Sector
Financial Market Development 3.2 (max 7.0) rank: 118th out of 138 countries
    Banks' Soundness 3.5 (max 7.0) rank: 124th out of 138 countries
Banking Industry Country Risk 7(1 - lowest risk, 10 - highest risk)
    Economy Risk 7
    Industry Risk 7
Deposit Guarantee Scheme 
    Maximum Protected Amount 100 000 EUR
Country Ceiling for Deposits 
    Local Currency (Euro)Aa3 high grade
    Foreign CurrencyAa3 high grade
Deposit Rates (Aug 2016, EUR)0.21 % ↑ (Jul 2016: 0.20 %)
Banking Sector Structure 
    Number of Banks20
    Recent Changes (2015) new banks: 0, closed banks: 1
    Consolidated Assets (2015) 40 421.04 mln EUR ↓ (-2.45%)
Major Banks
 Nova Ljubljanska banka (NLB)  UniCredit
 Nova Kreditna banka Maribor (NKBM)  SKB (Societe Generale)
 Abanka Vipa
 List of Banks in Slovenia

Slovenian Economy

National Currency

Slovenia joined the Euro Area on 1 January 2007. The preceding national currency, Slovenian tolar (SIT), was replaced by Euro.

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GDP

According to Eurostat, nominal GDP of Slovenia in 2015 was 38.5 bln EUR.

Slovenia underperforms the European Union in terms of real GDP growth with the average annual differential coming to -0.2% over the past 10 years (2005 - 2015). In 2015 real GDP growth was 2.9% which was above the Euro Area average (1.6%) and above the European Union average (1.9%). Real GDP growth in 2016 - 2021 are IMF's estimates.

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

In 2015, nominal GDP per capita in Slovenia was 18 700 EUR.

Slovenia 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 -15.9% over the past 10 years (2005 - 2015). GDP per capita at PPP in 2016 - 2021 are IMF's estimates.

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

According to Eurostat, inflation rate in Slovenia in 2015 expressed as annual percentages of average consumer prices was -0.8% which was below the Euro Area average (0.0%) and below the European Union average (0.0%). Inflation rates in 2016 - 2021 are IMF's estimates.

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

Double Taxation Agreements

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

Slovenia signed DTAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):

 Albania
 Armenia (Apr 2013)
 Austria
 Azerbaijan
 Belarus
 Belgium
 Bosnia and Herzegovina
 Bulgaria
 Canada
 China
 Croatia
 Cyprus
 Czech Republic
 Denmark
 Estonia
 Finland
 France
 Georgia (Sep 2013)
 Germany
 Greece
 Hungary
 Iceland
 India
 Ireland
 Israel
 Italy
 Korea, Republic of
 Kuwait (May 2013)
 Latvia
 Lithuania
 Luxembourg
 Macedonia
 Malta
 Moldova, Republic of
 Montenegro
 Netherlands
 Norway
 Poland
 Portugal
 Qatar
 Romania
 Russian Federation
 Serbia
 Singapore
 Slovakia
 Spain
 Sweden
 Switzerland
 Thailand
 Turkey
 Ukraine
 United Kingdom
 United States
 Uzbekistan (Nov 2013)

There are also several agreements between Slovenia and other jurisdictions which were signed but haven't yet come into force (for agreements signed after after 01 January 2013 of signing the agreement is given in brackets):

 Egypt
 Iran, Islamic Republic of
 United Arab Emirates (Oct 2013)
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Information Exchange

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

  • spontaneously;
  • on request;
  • automatically.

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

Slovenia signed TIEAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):

 Guernsey
 Isle of Man

There are also several agreements between Slovenia and other jurisdictions which was signed but haven't yet come into force (for agreements signed after 01 January 2013 of signing the agreement is given in brackets):

 Jersey (Nov 2013)

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

Slovenia signed the automatic information exchange agreement on 29 October 2014 and committed to start the automatic information exchange in September 2017.

Further Information:
Automatic Exchange of Information on Financial Accounts
Countries Which Will Not Automatically Exchange Account Information

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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).

Slovenia has FATCA agreement with the U.S. in effect since 02 June 2014 (Intergovernmental Agreement Model 1). Financial institutions operating in Slovenia 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: Slovenian financial accounts hold in U.S. financial institutions will be reported to Slovenian authorities.

Further Information:
FATCA and European countries

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Slovenian Banking Sector

Financial Market Development

According to World Economic Forum's Global Competitiveness Report 2016-2017, financial market development in Slovenia is scored 3.2 out of maximum 7.0 and ranked 118th out of 138 analysed economies. Soundness of banks is scored 3.5 bringing Slovenia into the 124th place, trustworthiness and confidence of financial market is scored 3.2 (124th place).

Financial Market Development in Slovenia.
Chart 4. Financial Market Development in Slovenia. Source: WEF.
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Banking Industry Country Risk

Banking Industry Country Risk Assessment (BICRA) is a methodology designed by Standard&Poor's "to evaluate and compare global banking systems". A BICRA is scored on a scale from 1 to 10, ranging from the lowest-risk banking systems (group 1) to the highest-risk (group 10). The BICRA methodology has two main analytical components: "economic risk" and "industry risk". Each of the components is then further divided into 3 "factors" that result in an economic and industry risk score for each country.

Slovenia is included into group '7' with economic risk scored '7' and industry risk scored '7'.

BICRA Group 7
Economic risk 7
    Economic resilience intermediate
     Economic imbalances very high
    Credit risk in economy high
Industry risk 7
    Institutional framework high
    Competitive dynamics high
    Systemwide funding high
Government support assessment supportive

Table 1. BICRA for Slovenia. Source: S&P's.

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Deposit Guarantee Scheme

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 Slovenia are summarised in Table 2.

Scheme Participantsall credit institutions operating in Slovenia, branches of non-EEA banks, branches of Slovenian banks abroad
Scheme Exemptionsbranches of EEA-banks (covered by their home countries)
Eligible Depositorsprivate individuals, private individuals independently engaged in business activities, sole traders or legal entities that do not satisfy the criteria for being classed as a large or medium-size enterprise
Covered Accountscurrent accounts, savings deposits, cash deposits, and certificates of deposit and bills
Maximum Protected Amount100 000 EUR
Paid In CurrencyEUR

Table 2. Deposit guarantee scheme in Slovenia.

EEA stands for European Economic Area and consists of all EU member states plus Liechtenstein, Norway and Iceland.

Further Information:
Deposit Guarantee Schemes in Europe

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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) deposit ceiling for Slovenia is set to Aa3 (high grade), foreign currency deposit ceiling is Aa3 (high grade).

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Deposit Rates

In Aug 2016, 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 0.21% which was below the Euro Area average (0.53%).

Deposit Rates in Slovenia.
Chart 5. Deposit Rates in Slovenia. Source: ECB.

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Banking Sector Structure

Currently there are 20 credit institutions operating in Slovenia.

Recent structural changes (2013 - 2015) of the banking sector of Slovenia are summarised in Table 3.

201320142015
Number of Opened Banks010
Number of Closed Banks001

Table 3. Recent structural changes in the banking sector of Slovenia.

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

CategoryNumber of Banks
Banks16
Branches of foreign banks3
Central banks1

Table 4. Number of banks by category in Slovenia.

The list of the most recently opened banks in Slovenia is provided in Table 5.

NameStart Date
 Brüll Kallmus Bank AG, Bančna podružnica v Sloveniji (new)May 2014

Table 5. The most recently opened banks in Slovenia.

There are 3 branches of foreign banks from 2 different countries in Slovenia. Table 6 shows the number of branches grouped by the country of origin.

Country of OriginNumber of Branches
 Austria2
 France1

Table 6. Number of branches of foreign banks in Slovenia grouped by country of origin.

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