The Slovak banking sector achieved a net profit of €564.6 million in the first six months of 2023. (source: SME - Jozef Jakubčo)
Slovak banks posted a net profit of €564.6 million in the first six months of 2023 - a year-on-year increase of 46.6 percent, according to data from the National Bank of Slovakia (NBS).
At the end of June last year, sector profit stood at €385.1 million.
Not reflected in salaries
The majority of the sector's profit is made up of net interest income, which rose year-on-year by 30.2 percent to €1.07 billion.
According to the Slovak Banking Association (SBA), "the profitability of the banking sector is neither extraordinary nor above-standard," and pointed out that banks in neighbouring states registered even higher profitability.
However, trade unions say Slovak banks' huge profits are not being reflected in branch employees' salaries, which have not risen to take into account inflation. An ordinary employee earns a gross wage of €1,200 without bonuses.
Unions had called on the banking association to hike wages in 2024 to at least the level of the average inflation rate for 2023. However, the proposal has been rejected by the SBA.
Pre-election topic
Meanwhile, interest rates and mortgage repayments have increased sharply from 1 percent at the beginning of 2022 to 4.4 percent today. According to the NBS, increases will affect approximately every second mortgage by the end of 2025. On average, the increase should be €100.
The issue has become a prominent pre-election them among political parties, with many promising measures, including taxes and subsidies, to tackle it. Some have warned people will lose their homes and may see huge hikes in mortgage repayments, although the NBS has said large rise in the hundreds of euros would only affect a small number of mortgage holders.
