Featured Product

    IMF Publishes Reports on 2018 Article IV Consultation with Slovenia

    February 18, 2019

    IMF published its staff report and selected issues report under the 2019 Article IV consultation with the Republic of Slovenia. Directors noted that financial stability has improved, owing to the decisive restructuring of ailing banks and prudent macro-economic policies. They add that large banks have adopted a proactive management of their nonperforming loans (NPLs) and supervisory authorities should continue to encourage and support these efforts. Furthermore, the administrative and regulatory burden needs to be reduced further to support investment and firm growth.

    The staff report highlights that, since the 2013 banking crisis, financial-sector stability has improved, though some legacy problems remain. Banks are well-capitalized and liquid while the overall asset quality has improved. Overall, progress has been made in resolving the NPLs; however, NPLs of small and medium enterprises (SME) remain elevated in the low double digits. Staff welcomed the adoption of the toolkit and handbook for resolving SME NPLs, in addition to the NPL guidelines, the ECB measures for the three banks it oversees, and the large banks’ proactive management of NPLs. It is recommended that supervisors should actively engage with banks on business models in light of the declining net interest income and should push banks to speed up the resolution of SME NPLs. Further efforts in strengthening insolvency procedures for SMEs would also help. The authorities agreed with staff’s analysis and advice. 

    The report further notes that new financial vulnerabilities could emerge, including in the housing market. Credit risks could emerge due to the elevated share of high variable-interest loans to both households and non-financial corporations. The decision to broaden the scope of macro-prudential tools for the real estate market to cover total household lending is welcome. The Bank of Slovenia maintains its macro-prudential guidance as recommendation to banks. It recommends that the loan-to-value ratio not exceed 80% and the debt-service-to-income ratio be limited to 50% for lower incomes and 67% for higher incomes. It is also recommended that consumer credit maturities not exceed 120 months. However, the limits could be made mandatory and be set at more binding levels when needed. The national authorities agreed to closely monitor risks in the housing market and take further macro-prudential measures, if needed.

     

    Related Links

    Keywords: Europe, Slovenia, Banking, Article IV, Financial Stability, NPLs, Macro-Prudential Policy, IMF


    Related Articles
    News

    EBA Single Rulebook Q&A: Second Update for November 2019

    EBA updated the Single Rulebook question and answer (Q&A) tool with answers to eight questions that relate to the Bank Resolution and Recovery Directive (BRRD) and the Capital Requirements Regulation and Directive (CRR and CRD).

    November 15, 2019 WebPage Regulatory News
    News

    FASB Delays Effective Dates for CECL, Leases, and Hedging Standards

    FASB issued two Accounting Standards Updates finalizing the delays in effective dates for standards on current expected credit losses (CECL), leases, hedging, and long-duration insurance contracts.

    November 15, 2019 WebPage Regulatory News
    News

    ESMA Updates Q&A on Securitization Regulation in November 2019

    ESMA updated questions and answers (Q&A) on the Securitization Regulation (Regulation 2017/2402).

    November 15, 2019 WebPage Regulatory News
    News

    HKMA Announces Finalization of Banking Liquidity Amendment Rules 2019

    HKMA issued a letter informing all authorized institutions that negative vetting of the Banking (Liquidity) (Amendment) Rules 2019 (BLAR) has now expired. Thus, the BLAR will now come into operation from January 01, 2020.

    November 15, 2019 WebPage Regulatory News
    News

    BCBS Consults on Revised Disclosures for Market Risk Framework

    BCBS launched a consultation on the revised disclosure requirements for the market risk framework for banks.

    November 14, 2019 WebPage Regulatory News
    News

    BCBS Consults on Disclosure Templates of Sovereign Exposures of Banks

    BCBS published a consultation on the voluntary disclosure templates related to sovereign exposures of banks.

    November 14, 2019 WebPage Regulatory News
    News

    PRA Publishes Final Policy on Maintenance of TMTP Under Solvency II

    PRA published the policy statement (PS25/19) that contains the final supervisory statement (SS6/16) on maintenance of the transitional measure on technical provisions (TMTPs) under Solvency II.

    November 14, 2019 WebPage Regulatory News
    News

    FSB Examines Implementation of Resolution Regimes in Financial Sector

    FSB published a report that examines progress in implementing policy measures to enhance the resolvability of systemically important financial institutions and sets out plans for further work.

    November 14, 2019 WebPage Regulatory News
    News

    IAIS Adopts ComFrame, ICS, and Holistic Framework for Systemic Risk

    IAIS adopted a comprehensive set of reforms—Common Framework (ComFrame), Insurance Capital Standard (ICS) Version 2.0, and Holistic Framework for Systemic Risk—that will enable effective cross-border supervision of insurance groups and contribute to global financial stability.

    November 14, 2019 WebPage Regulatory News
    News

    PRA Publishes Templates for Statistical Disclosures Under Solvency II

    PRA published templates for statistical disclosures, as required under Article 31(2) of the Solvency II Directive.

    November 14, 2019 WebPage Regulatory News
    RESULTS 1 - 10 OF 4157