BRATISLAVA, June 29, (WEBNOVINY) — The banking sector in Slovakia reported a taxed profit of 240.9 million euros at the end of this May. According to data of the central bank, this is 32.5 percent less than at the same time of last year. Net interest income dwindled slightly, by 0.5 percent, to 736.7 million euros, net income from fees and commissions fell by 1.3 percent to 190.1 million euros. Profitability of banks in Slovakia has dropped this year mainly due to the introduction of a special bank levy, according to the central bank.
When the levy was introduced, banks repeatedly warned that the levy will have a negative impact on their profitability this year. The National Bank of Slovakia said that the profit of the sector might not return to the pre-crisis levels also because the bank levy. The financial sector has been already taxed more than in the past and this is probably not going to change.
The negative impact of the bank levy on the banking sector, according to the Slovak Banking Association, will be more significant than the levy to be imposed on regulated firms. Calculations of the Banking Association show that the tax impact on banks from the increased levy and the extra levy will be about 54 percent of their profits, while for regulated entities it would be on average only 28.5 percent. In some individual cases, the effective tax rate for banks exceeds 70 percent, according to the association.
Burdening the banking sector by a bank levy of 0.4 percent of liabilities, net of equity capital, according to the Banking Association, is unreasonably high compared to other European Union countries, as well as compared with the burden of other businesses operating in Slovakia.
SITA
