IT WAS not so long ago that a Slovak bank client had access to only a current bank account, a passbook, or a special socialist bank product - an advantageous loan to young married couples.
Today, together with the developing Slovak bank sector, clients are becoming more educated and demanding. They are better oriented in financial issues and they want sophisticated banking products and services.
Norbert Lazar from OTP Banka added: "Bank clients today are 100% more demanding, and this comes from their better orientation in the financial sector. Clients want their money to be understandable, but they also want professional products and services along with products fitted specifically for them. We understand the trend."
"Slovak citizens are learning step by step to optimize the use of products, for example service packages, internet banking, and credit cards. We are trying to provide a portfolio of services such that every client can find what he needs", said the spokeswoman of Všeobecná úverová banka, Silvia Nosálová.
Tough competition in the banking sector and trends in international markets, in combination with the fact that there are foreign shareholders in most of Slovakia's banks, have forced the banking houses to introduce new bank products fitted for client demands.
Nowadays you probably will not find a bank that only offers a client a current bank account with a payment card. You will be able to choose from a wide spectrum of client packages offering additional services, like overdraft limits, mobile banking, internet banking, international payment or credit cards, as well as the possibility to transfer your temporarily unneeded finances from a current account to term deposits.
Special convenient accounts for young people and students or pensioners are also quite popular.
Banks try to compensate for poor deposit rates by special combined investment products. Many of them offer the possibility to put money into investment funds. Some banks widen their product portfolio by insurance or leasing products.
After initial scepticism, Slovak clients have become fond of credit products.
A customer can choose from a wide range of credit products - consumer loan, mortgage loan, or a credit card.
Although banks try to present their credit products as available for everyone, they, of course, are affordable only to creditworthy clients, regardless of whether it is an individual or a business client.
Apart from the fact that credit is simply too expensive for most customers, a Slovak client is conservative in taking credit. Deeply in their minds, Slovaks store a mournful scene from the beginning of the last century in which a crying family that could no longer pay its credit is deprived of its house by a nasty banker.
These are the reasons why the indebtedness of Slovak families is still lower than in developed European countries or even in the Czech Republic or Hungary. While household debts in Slovakia represent about 6 percent of GDP, in the Czech Republic it is about 8 percent, and in Hungary 9 percent. In Germany it is around 45 percent.
But analysts and banks say this is changing. Nowadays, taking credit is more and more popular. The volume of credit granted to households has doubled since 1999, from Sk35 billion (€850.78 million) to Sk70 billion (€1.7 billion) this year.
"Sometimes Slovak clients are too careful, because they were not used to living on credit, but the situation is gradually changing and people are realising that, for example, a credit card can be convenient for them," said Nosálová.
"The Slovak client is easily getting used to good things. Living on credit is comfortable and if a credit burden remains at a reasonable level, which a bank also evaluates when it is going to approve a loan, it can solve his problems. In fact, such a lifestyle is completely normal in the USA or western Europe", said Lazar.
However, he emphasized: "The client must have a clear purpose for the credit and he cannot forget that he needs to pay the loan within the agreed scheme of instalments.
"If a client is having difficulties with paying his loan, active cooperation with the client is needed to find an optimal solution.
But this is not happening very often in cases of individual clients, because a bank and the client have to take into account all the credit risks before concluding the contract."
Banks have been criticised for their approach to business clients, especially to small and medium-sized enterprises. Business society had the impression that banks were not willing to grant credit to business clients. Some representatives of SME even accused banks of hindering economic growth in Slovakia for that reason.
Banks have been hesitant to provide credit to business and corporate clients due to their negative experiences in the past before they underwent the massive restructuring.
The problems were basically caused by the incomplete evaluation of risks in granting credits to big business and corporate clients between 1994 and 1998 (government of the former Prime Minister Vladimír Mečiar). In many an analyst's opinion, loans were at that time often politically ordered.
Banks, however, started to be more active in this sector. "Of course, credit for business clients is based on good projects. Every year the number of good projects increases. We see great potential in this area," said Lazar.
He also added that the bank has already prepared new products for business clients, and it even concentrates on the cooperation of a business client in using structural European funds.
As a spokeswoman of Slovenská sporiteľňa, Eva Forraiová-Güttlerová, underlined: "Accession into the European Union, from the point of view of small and medium-sized entrepreneurs, means an opening market for Slovak firms. But it also means increased foreign competition, an inflow of foreign investments, and the possibility of gaining finance from European funds.
"That is why Slovenská sporiteľňa emphasizes developing relationships with business clients on a long-term and individual basis. The volume of loans granted to small and medium-sized entrepreneurs in our bank increased 653 percent from January to June this year," she added.
"Banks recently had a bad experience with crediting business subjects, and this was the reason for 'such a distant approach'.
But this is now in the past, and banks do realise the importance of these clients. Newly prepared deposit and credit products for this segment prove that", said Nosálová from VÚB.
Banks are now working to place the services for small and medium-sized enterprise sectors on the same high standards of products for individual clients, she said.
