Slovenská sporiteľňa achieved profit after tax in the amount of EUR 54.7 million in the first quarter of 2024. It decreased by almost 20 percent y/y

“Despite the decline of net profit, we had a good quarter. The 9% growth of operating profit is mostly the result of the larger loan portfolio and we also saw higher commission income from insurance, investments and payment card transactions. Our expenses were affected by several factors – the special levy, increase of salaries for our colleagues and additional investments into digitalization. We also introduced a digital innovation – the I want to help functionality. In just a few clicks in George you can donate funds to one of the non-profit organizations for a charitable cause. I am hopeful that this will help this important sector to be even more successful, as George is the most widely used, popular and just recently also the best banking app on the Slovak market,” says Peter Krutil, CEO and CFO, Chairman of the Board of Directors of Slovenská sporiteľňa.

Business performance overview of Slovenská sporiteľňa as of 31 March 2024  

Net interest income went up by 10.2% y/y from EUR 125.1 million to EUR 137.8 million. The increase of net interest income is the result of growing loan portfolio. On the other hand, interest expenses for deposits and other financial liabilities went up y/y.

Net fee and commission income increased by 10.0% y/y from EUR 50.1 million to EUR 55.1 million. Income from brokerage of insurance, investments into mutual funds, fees associated with account maintenance and payment card transaction fees had a positive effect on net fee and commission income.

The bank recorded a net trading profit of EUR 3.3 million (it was EUR 4.2 million in 2023) which is mainly attributable to derivative transactions.

Operating expenses went up by 9.3% y/y to EUR 89.4 million (in 2023 it was EUR 81.9 million). Personal expenses increased by 7.3% y/y mainly because of wage growth caused by inflation. Other administrative expenses grew by 15.8% mainly because of increased IT costs as a result of investments in digitalisation and modernisation and due to higher inflation and energy prices.

Operating profit went up by EUR 8.9 million, accounting for an increase of 9.1% y/y. Cost income ratio remained unchanged at 45.5% compared with last year.

The bank recorded a net impairment loss from financial instruments in the amount of EUR 15.4 million in 2024, while in 2023 it was a loss of EUR 2.2 million. A slight growth in non-performing consumer loans is behind the y/y increase. Slovenská sporiteľňa proceeds a prudent provisioning approach. The share of non-performing loans on total loan volume increased from 1.6% to 1.9% while their coverage with provisions decreased from 122% to 101.7%.   

From January 2024, the bank is required to pay a so-called "special levy", which has a significant negative impact on net profit after tax. The annual levy rate set by the legislation for the financial year of 2024 is 30%. On the other hand, the bank is not obliged to contribute to the National Resolution Fund in 2024, which only partially compensates for the introduction of the special levy.

The volume of loans products to customers (including loans, leasing and factoring) increased by 4.3% y/y and achieved EUR 18.9 billion. Retail loans grew by 3.8% (EUR 500 million). Housing loans grew by 2.9% (EUR 300 million in absolute terms) and consumer loans went up by 9.7% (EUR 140 million). Slovenská sporiteľňa again confirmed its position as market leader in retail loans; its market share in retail loans reached 24.7% at the end of March 2024.  

Loans to corporate clients (including factoring and leasing products) increased by 4.2% y/y (by EUR 300 million) and reached EUR 6.7 billion. We recorded growth in all segments.

Deposits from customers rose from EUR 17.2 billion to EUR 17.6 billion compared with the year 2023.