BRATISLAVA, September 28, (WEBNOVINY) — The banking sector in Slovakia reported a taxed profit of EUR 359.9 million at the end of August. According to data of the central bank, this is 33.7 percent less than at the same time of last year. Net interest income represents a major portion of the profit, but in August they dwindled by 1.6 percent to EUR 1.181 billion.
The central bank says that several factors were behind their decrease while of the core importance as the development in the sector of households. The common feature of the development on both the market of loans or deposits was the continued rivalry of banks mirrored in their interest rate policy.
Non-interest revenues dwindled more significantly by 12.4 percent to EUR 345 million. According to the central bank more or less one-off income from investments and mutual funds in some banks influenced last year’s considerably positive result. Without these influences the profitability would not post such a big y/y drop. Moreover, banks recorded an increase of costs linked to the newly introduced tax levy. Revenues from trading plummeted as well when within the banking sector mainly costs on bonds have increased.
The outlook of the development of the banking sector’ profitability in the next months however is rather negative, according to the central bank’s expectations. Most of the trends with negative influence on it will persist and several of them will strengthen further.
Last year’s taxed profit of the banking sector in Slovakia increased by about one-third to EUR 668.5 million. However, an important component of banks’ profit was one-off income. After its deduction, net profit of the banking sector last year was around EUR 503 million, which is approximately the same as in 2010.
SITA
