The Group of Slovenská sporiteľňa achieved profit after tax in the amount of EUR 308.9 million in 2023. ROE achieved 13.5%

“The return of deposit products is probably the highlight of the year 2023 in banking. After years of extremely low interest rates, we are again experiencing a more traditional banking model because of the ECB’s fight against inflation. The clients will also benefit from this, as almost all of them have deposits but only one fifth have a loan. And even though the loan market slowed down because of higher interest rates, we were still able to grow faster than the market in mortgages, consumer loans and corporate loans. I think this shows that our clients view us as a stable financial partner. As a result, we were able to surpass the mark of 400 million euros in operating profit for the first time ever. In terms of costs, we were impacted by two factors – lower provisions and growth of operating expenses resulting from higher wages for our colleagues and investments into innovations and modernisation. As a digital leader we aim high with our ambitions. And two more things pleased me. Over the last two years our foundation provided almost two million euros each year for various projects and organisations. And we also won numerous domestic and international awards, including two Bank of the Year awards,” says Peter Krutil, CEO and CFO and Chairman of the Board of Directors of Slovenská sporiteľňa.

Business performance overview of Slovenská sporiteľňa as of 31 December 2023  

Net interest income went up by 17.8% y/y from EUR 443.9 million to EUR 523.0 million. The increase of net interest income is the result of growing loan portfolio and growing interest rates following the tightening of monetary policy by ECB. This was translated into an increase of interest income from loans and gradual increase of interest expenses for deposits and other financial liabilities during year 2023.

Net fee and commission income increased by 8.0% y/y from EUR 192.2 million to EUR 207.5 million. Income from payment services generated mainly through the increased number and volume of payment card transactions, investments into mutual funds, brokerage of insurance and lower costs associated with fees and commissions for loan mediation all had a positive effect on net fee and commission income.

The bank recorded a net trading profit of EUR 21.6 million (it was EUR 23.6 million in 2022) which is mainly attributable to derivative transactions.

Operating expense went up by 8.1% y/y to EUR 332.1 million (in 2022 it was EUR 307.1 million). Personal expenses increased by 9.1% y/y mainly because of wage growth caused by inflation, other administrative expenses grew by 9.6% 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 66.5 million, accounting for an increase of 18.7% y/y. Cost income ratio decreased to 44.0% compared with last year.

The bank recorded a net impairment loss from financial instruments in the amount of EUR 15.2 million in 2023, while in 2022 it was loss of EUR 32.1 million. In 2022, the provisions were created for the various uncertainties and potential losses of bank clients caused by the energy crisis. The development in 2023 was driven by economic recovery.

The share of non-performing loans on total loan volume increased from 1.6% to 1.9% while their coverage with provisions decreased from 121.3% to 101.6%.

 The volume of loans products to customers (including loans, leasing and factoring) increased by 5.3% y/y and achieved EUR 18.9 billion. Retail loans grew by 4.9% (by EUR 600 million). Housing loans grew by 4.3% (EUR 400 million in absolute terms) and consumer loans went up by 9.1% (EUR 130 million in absolute terms). 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 December 2023.

Loans to corporate clients (including factoring and leasing products) increased by 5.6% y/y (by EUR 400 million) and reached EUR 6.7 billion. We recorded growth in almost all segments.

Deposits from customers rose from EUR 16.9 billion to EUR 17.6 billion compared with the year 2022.

Current ratings of Slovenská sporiteľňa (as of 31 December 2023)