Business News

Slovenian Banking Sector Returns to Profit in Q1

Ljubljana, 08 June (STA) - The Slovenian banking sector returned to profit in the first quarter of the year after a loss-making 2010 and in spite of growing provisions in the first months of the year. Figures from the central bank show the banks making EUR 46m in combined pre-tax profit in the first quarter, which rose to EUR 54m through April.

The return to profitability of the sector comes despite mounting provisions and write-downs in the first four months of the year, which at EUR 176m surpassed that of the same period last year by 18.3%, Banka Slovenije's Bulletin says.

It also comes after the banks finished with EUR 15.6m in combined pre-tax losses in the first two months of 2011 and EUR 96.4m in 2010.

Meanwhile, the total assets of banks in Slovenia fell by 3.1% year-on-year owing to a EUR 1.8bn drop in April, which was caused primarily by the state withdrawing nearly EUR 1bn in deposits.

Banks in Slovenia continued to reduce their liabilities to foreign banks in April, paying back EUR 373m in loans in this month alone, bringing the total figure of foreign loans paid back to EUR 831m for the year-to-date.

Meanwhile, loans to businesses stagnated in April, falling slightly over March and by 3.4% compared to April 2010.

Banka Slovenije said the drop in lending to companies is foremost a result of a contraction in lending by foreign-owned banks, whereas Slovenian-owned banks increased their financing of businesses.

Loans to households meanwhile rose by 7.3% year-on-year in April, owing to strong crediting from foreign-owned banks.

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