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Slovakia Commercial Banking Report Q3 2007Product Type: Market Research ReportPublished by: Business Monitor International Published: October 2007 Product Code: R302-2448 Description Key IssuesThis quarter we have updated a lot of the numeric information in the banking reports. We now have final banking statistics, sourced from the central bank/regulator or trade association, in relation to the end of 2006 for all countries except Iran. All of the commercial banking reports need to be considered in the context of a global environment that was benign for banks in the vast majority of the 59 countries for which we have collected data. In 2006 the median local currency growth in total assets was 17.2% in Croatia. The median local currency growth in total loans was 18.2% in Bangladesh. The median local currency growth in total deposits was 16.9% in Algeria. In almost all countries local currencies were stable or rising relative to the US dollar. Except in Venezuela and Iran, figures were not distorted by double-digit inflation. Loan/deposit, loan/asset and loan/GDP ratios all provide a rough measure of the development of the banking systems. Across the 59 countries for which we have collected data, the median loan/deposit ratio is 85.1% in Thailand. The median loan/asset ratio is 54.8% in Romania. The median loan/GDP ratio is 53.4% in Kuwait. Across the eurozone, by comparison, the equivalent numbers are 126.4%, 50.6% and 119.3%. All three ratios are rising in most of the countries for which we have collected data. The Slovak economy is growing rapidly. This growth is underpinned by an export oriented manufacturing sector. Wage levels, especially in the most developed regions, are now converging on Western European average levels. This, naturally, is fuelling domestic demand that will compliment export industries in the coming years. These developments are all positive for further growth in the banking sector. The Slovak banking sector is already relatively mature and, relative to the size of the population, larger than in many of the other countries in its region. Growth then will come off a solid foundation rather than being explosive from a low base. As is the case in the neighbouring Czech Republic, the loan/deposit, loan/asset and loan/GDP ratio are all low in Slovakia. Unlike the Czech Republic, however, the loan/deposit ratio is rising at a rapid rate. This suggests that unlike their peers, the multinational banks’ subsidiaries in Slovakia are still attracted to the idea of recycling deposits to non-bank clients. Table of Contents
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