Profitability of the banking sector deteriorates

The prospect of making a profit in the banking sector has deteriorated, according to the National Bank of Slovakia (NBS). A further decrease in the cost of credit risk is very unlikely, believes the central bank, and the cost of sources of financing in the case of several deposit products is close to their minimum. Profits for banks in Slovakia reported two-digit growth, although their margins are shrinking due to very low interests on loans. Financial houses are striving to compensate for low interests with increased lending, and they are also managing to raise net income from fees. The lower formation of provisions and reserves, the lowering of the bank levy and higher income from fees contributed to their profits as well, reads the Hospodárske Noviny daily.