Consolidated, audited financial results of Slovenská sporiteľňa as of 31 December 2018 according to International Financial Reporting Standards (IFRS).

“Modern Slovakia, a modern Slovenská sporiteľňa, is the leitmotif of last year as I perceive it, in the digital atmosphere of the Company, especially George. Jointly with the Foundation of Slovenská sporiteľňa we have launched the grant #mamnato (#believeinyourself) and supported local heroes turning Slovakia into a modern country. Also the year 2018 in business was a success story for the Company. Despite the extraordinarily low rates, we have succeeded in maintaining our interest revenues from last year. The costs have also been reviewed and efficiency increased, starting by making processes simpler through to optimising our branches. We devoted great attention to corporate clients and I am pleased that we are becoming the bank of first choice for this segment,” said Peter Krutil, Chairman of the Board of Directors and CEO of Slovenská sporiteľňa.

Financial highlights as of 31 December 2018 (y/y comparison)

  • net interest income went down by 0.3% y/y from EUR 439.3  million to EUR 437.8 million,
  • net fee and commission income increased by 14.3% y/y from EUR 112.7 million to EUR 128.8 million,
  • operating profit went up by 5.0% y/y from EUR 286.1 million to EUR 300.4 million,
  • net profit after tax increased by 12.1% y/y from EUR 163.9 million to EUR 183.7 million,
  • volume of loans and receivables to customers grew by 9.1% y/y from EUR 11.7 billion to EUR 12.8 billion,
  • deposits from customers increased by 9.4% y/y from EUR 12.5 billion to EUR 13.7 billion,
  • cost income ratio reached 48.3%,
  • capital adequacy reached 18.1% and continues to considerably exceed the limit stipulated by the law (according to ECB/NBS, Basel III and IRB approach),
  • loan-to-deposit ratio decreased y/y from 93.9% to 93.6%.

Business performance overview of Slovenská sporiteľňa as of 31 December 2018

Net interest income went down slightly by 0.3% from EUR 439.3 million to EUR 437.8 million. This decrease is the result of low interest rates on the market and strong pressure on margins for new and refinanced loans. Another positive factor were maturing securities with higher interest income.

Net fee and commission income went up by 14.3% y/y from EUR 112.7 million to EUR 128.8 million. In 2018, the bank was particularly successful in mediation of insurance as it recorded a y/y increase of insurance commissions by EUR 11.5 million and fee income from card transactions went up by EUR 2 million compared with previous year.

The net profit in the amount of EUR 9.7 million in the area of net trading and fair value result related mainly to the development of derivate instruments is lower by 29.8% compared with the comparable period of 2017 when it achieved EUR 13.8 million. This decrease is mainly the result of lower yields from market positions which is related to the relatively quiet situation on financial markets.

General administrative expenses went down slightly by 0.6% to EUR 281.1 million (in 2017 it was EUR 282.7 million). The decrease of general administrative expensed was related to the efficiency improvement of internal processes while the bank continued to focus on improvement of client service quality. Total personal expenses went up slightly by 0.6% and amortisation costs recorded a moderate decrease (by 4.4%).

Cost income ratio improved from 49.7% to 48.3% y/y as a result of growing operating income and decrease of costs.

Despite a massive growth of loan portfolio, total risk costs of the bank reached EUR 23.5 million, i.e. a decrease by 30% compared with 2017. The positive development of risk costs was triggered by both the retail and corporate segments. The share of defaulted loans on total loan volume decreased from 3.8% to 3.3% while the coverage with provisions went up from 79.7% to 80.9%.

Consolidated profit after tax went up by 12.1% y/y and reached EUR 183.7 million.

The bank levy went up by EUR 2.9 million to EUR 30.3 million. The annual contribution into the Single Resolution Fund reached an estimated amount of EUR 2.7 million (EUR 2.8 million in 2017). The contribution into the Deposit Protection Fund increased by 8.4% y/y to EUR 0.9 million (EUR 0.8 million in 2017). Total levies of the bank are at EUR 33.9 million.

The volume of loans to customers increased by 9.1% y/y and achieved EUR 12.8 billion. Retail loans were the major driving force; they increased by 7.6% y/y (by EUR 0.7 billion) compared with 2017. Slovenská sporiteľňa again confirmed its position as market leader in retail loans; its market share reached 26.9% at the end of 2018. The main growth driver were housing loans which grew by 8.3% (EUR 600 million in absolute terms) and consumer loans which grew by 4.8% (by EUR 100 million). Loans to corporate clients (including factoring and leasing products) increased by 19.8% y/y (by EUR 600 million) and reached EUR 3.4 billion.

Retail deposits increased from EUR 10.3 billion to EUR 11.2 billion, providing a solid base for financing and room for further growth of the bank. Deposits from customers rose from EUR 12.5 billion to EUR 13.7 billion compared with 2017.

Current ratings of Slovenská sporiteľňa (as of 31 December 2018)