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Economics Department
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XP L I C I T
Slovakia –
From Truant to Star Pupil?
February 2003
Members of HVB Group
Contents
Foreword ....................................................................................................................................................................................................3
Slovakia – From truant to star pupil? ......................................................................................................................................................4
New government steps up the pace of reform ................................................................................................................................4
Economic growth strong in 2002, weaker in 2003............................................................................................................................5
Outlook: “J-growth” ..........................................................................................................................................................................5
Direct investments: fourfold increase in three years...............................................................................................................................6
Some important investments in industry...........................................................................................................................................7
Euro: Introduction at the beginning of 2008?..........................................................................................................................................8
Slovakia at a glance .................................................................................................................................................................................10
Imprint:
Published by: Bank Austria Creditanstalt AG
http://www.ba-ca.com
Economics Department
e-mail: [email protected]
Printed by: Uhl
Graphics: Horvath Grafik Design
February 2003
Foreword
Slovakia’s integration efforts will peak in May 2004, when it officially joins the European Union. Since the
beginning of the transformation process, Slovakia has achieved a number of milestones. One was the creation of
the Slovak Republic on 1st January 1993. One of the foremost objectives of the young country was to achieve
integration with the European Union as quickly as possible. In October 1993 the Europe Agreement was signed
between the EU and the Slovak Republic (which came into force on 1st February 1995), and as early as June 1995
an official application was submitted for EU membership. On account of the changes in the country’s domestic and
foreign policies which have occurred in the meantime, accession negotiations with the EU began in 2000, and were
successfully concluded in December 2002.
As was the case in the other reform countries, Slovakia’s economy had to (and in many areas must still)
undergo a painful restructuring process. An additional burden was the fact that economic policies prior to the
turnaround promoted large, capital-intensive companies which strongly focused on sales to the Comecon countries.
These companies suffered disproportionately at the beginning of the transformation process on account of the
economic weakness in these countries.
Through the greater emphasis on privatisation since 1999, and with the help of foreign investors, there was
a substantial increase in the influx of foreign direct investment (FDI). In 2002 alone, some EUR 4 bn entered the
country, which represents almost half of the total inventory of FDI since the turnaround (just under EUR 9 bn).
The Slovak Republic offers investors a number of attractive benefits, such as a highly-trained workforce and,
particularly in the western part of the country, a well-developed infrastructure.
Economic developments in Slovakia are currently being driven by a strong domestic economy which made
GDP growth of an estimated 3.8 % possible in 2002. On account of strong private and public-sector demand, there
was a slight improvement on the labour market. Despite the weak state of the global economy, we expect growth
of 3 % or more in 2003 and 2004.
Marianne Kager
Chief Economist, Bank Austria Creditanstalt
3
Slovakia – from truant to star pupil?
Slovakia – from truant to star pupil?
New government steps up the pace of reform
The new government, formed after the parliamentary elections in September and headed by former Prime
Minister Mikulas Dzurinda, quickly began to implement important reform measures. Slovakia’s relations with the
EU and the USA have continued to improve significantly under the new government. While prior to the EU’s
December 2000 summit in Nice, Slovakia was in the second row of possible candidate countries, in the meantime
the country has been able to pull forward, and was the second country after Cyprus and the first country in the
CEE region to complete accession negotiations with the EU before the Copenhagen summit. Negotiations on the
country’s future membership in NATO also began in early December. In the government’s program declaration
from November 2002, the chapter on “Economic Policy” devotes considerable attention to the planned reform of
public finances. During the first phase of the legislative period the budget deficit is to be lowered to 3 % of GDP by
Maastricht standards. The state budget is to be consolidated by implementing reforms in key areas of expenditures,
coupled with a simultaneous reduction in levies and direct taxes. Certain indirect taxes are scheduled to be
increased and VAT rates will be consolidated into a single rate prior to EU accession. Plans call to make the
conditions for obtaining state guaranties for loans much stricter, as this has been a major source of uncertainty for
the development of the budget in the past. In addition to reforming public finances, the government plans to
implement a wide range of other important measures:
◆ improvement of administration of EU funds;
◆ liberalization of the energy market;
◆ stronger efforts to combat corruption;
◆ reforming legal procedures in the court system in order to speed up the processing of cases;
◆ supporting greater utilization of modern information technology, by public administration as well (including the
creation of a legal framework for electronic signature;
◆ the government intends to introduce a three-pillar system in the pension insurance administration and to reform
the financing of the health care system with the goal of curbing the growing debt generation of the current
system;
◆ ensuring that social benefits actually reach those who are entitled to them.
The government’s reforms plans will not be possible without causing some social hardship, and the labor
union association has already called for demonstrations. It is also likely that there will be tensions within the
governing coalition when it comes to implementing some of the planned measures. In contrast to the previous
government, in which certain elements of the SLD (which is now no longer part of the coalition) opposed the
government’s policies on a number of occasions, the tensions expected in the current coalition will probably not
seriously hinder the reform plans. Clear measures in the 2003 budget The first major test of the government and
Parliament’s reform intentions was passing the budget for 2003 at the beginning of December. The new budget is
based on measures aimed to increase revenues and to cut expenditures as well:
◆ reclassifying some goods and services, in particular in the hospitality and freight forwarding sectors, from the
lowest VAT category (10 %) to the 23 % rate;
◆ raising petroleum and tobacco taxes;
◆ freezing wages and canceling certain bonuses, as well as freezing or reducing staff numbers in some branches
of public administration;
◆ various laws affecting expenditures for welfare support and residential construction subsidies are to be revised.
With these measures the central government’s revenues are targeted at SKK 235.4 billion (20.4 % of GDP), up
SKK 15.5 billion on 2002 (an increase of 7 % in nominal terms). This includes plans for tax revenues to be 17 %
higher than in the previous year’s budget. Expenditures (including SKK 10.7 billion for bank consolidation for the
4
Slovakia – from truant to star pupil?
first time) are projected at SKK 291.4 billion (25.3 %of GDP), which is also nominally 7 % higher than in 2002. This
increase is caused primarily by higher expenditures on wages and social transfers. Taking into account the
government’s inflation estimates, both central government expenditures and revenues should decline slightly in
real terms, which seems to be a realistic assumption. The budget calculations are based on GDP growth of 3.7 %
for 2003, annual average of inflation of 8.8 % due to planned price and tax hikes and an unemployment rate of
18 %. We also project unemployment at 18 %, but our estimates for increases in GDP and price levels are
somewhat lower, due to sluggish international economic recovery and weak private and public consumption.
The central government deficit is targeted at SKK 56.0 billion, or 4.9 % of GDP. Without the consolidation
measures the deficit would have grown to over 7 % of GDP. Some progress was already made by the previous
government in terms of increasing budget transparency: for example, the number of off-budget funds was cut by
integrating nine of the twelve funds into the budget. Now, plans call for achieving a surplus in the non-central
government public institutions, with the exception of the health insurance administration. According to
preliminary calculations based on the Maastricht method the general government deficit in 2003 is projected at
SKK 56.9 billion, or just under 5 % of GDP. For 2002, we estimate that the deficit was substantially over 7 % of GDP
(calculated by the same standards), due to high expenditures prior to the September elections. Even if it does not
prove possible to fully achieve the planned deficit reduction amounting to more than 2 % of GDP, the 2003 budget
consolidation will have a considerable impact in terms of restricting growth.
Economic growth strong in 2002, weaker in 2003
Despite the slow business cycle in Europe, over the first three quarters of 2002 Slovakia’s GDP growth was
supported by a strong rise in public and private consumption and exportshare increases since the third quarter.
Year-on-year GDP growth reached 3.9 % in Q1, 4.0 % in Q2 and continued increasing to 4.3 % in Q3. Domestic
demand rose by 3.5 % in the third quarter, with the improvement in net external exports contributing 0.8 % to
economic growth. The pace of private consumption slowed somewhat to 5 % in the third quarter, falling from 5.9 %
in the second quarter and 5.2 % in the first. Growth in public consumption also declined, in Q3 coming back down
to 2.7 %, after peaking at a high rate of 5.1 % for 2001 on average. The first two quarters of 2002 also saw very
vigorous growth in public consumption, which hit 5.7 % in Q1 and 7.7 % in Q2. In contrast to consumption, gross
fixed capital formation was weak, falling by 1.2 % in Q3 compared to the previous year, after having risen only
0.1 % in Q2 and contracting by 0.8 % in Q1. Strong GDP growth helped to keep unemployment down. The jobless
rate in October 2002 was 16.4 %, almost one percent lower than 12 months earlier. Over the first ten months of
2002, real wages in industry were up 4.3 % on the previous year, whereas they only grew by 2.7 % in 2001. By
November consumer price inflation had dropped to 2.9 % compared to a year earlier, whereas in 2001 the average
annual rate reached 7.1 %. With the planned price hikes for 2003 real incomes and private consumption will rise
considerably slower once again. The leeway for public consumption and public investment is also quite tight due
to the budget consolidation measures. Gross fixed capital formation should recover somewhat on the heels of the
poor figures for 2002, but will not increase too quickly because of tight corporate finances and moderate public
investment.
Outlook: “J-growth”
The quick pace of reforms adopted by the new government will lead Slovakia’s economy to grow on a J-shaped
curve: slow for the next one or two years and then accelerating rapidly based on the reforms. With unemployment
likely to remain high, inflation on the rise and moderate increases in real wages, the current account deficit should
not grow all too dramatically. Yet even though the path of rapid reform is promising for the future, it will not be
devoid of problems. Over the longer horizon, increased flows of short-term foreign capital, due to Slovakia’s
increasing attractiveness and the prospects for further narrowing the interest rate differential to the EU as soon as
the euro is legal tender in Slovakia as well, will probably lead to considerable pressure for appreciation of the
Slovak koruna. The National Bank of Slovakia will likely find it increasingly difficult to limit the volatility of the
koruna, needed especially after the country joins ERM-II.
Hans Holzhacker
5
Slovakia – from truant to star pupil?
Direct investments: fourfold increase in three years
Until 1999, direct investments to Slovakia remained meagre. Since then, however, significant progress has
been made in integrating Slovakia in the world economy and in strengthening the country’s ties with the EU.
Slovakia has become attractive for foreign investment. Total direct investment increased fourfold until 2002, and
Slovakia has advanced to fifth place in a ranking of direct investment as a percentage of GDP in the CEE 11
countries (see the relevant table).
Foreign investments have in particular supported the development of the automotive industry and the steel
industry, besides stabilising the banking sector and helping to secure Slovakia’s important role in the transit of
natural gas.
Foreign Direct Investment
1999
2000
2001
2002E
Stocks, end of period in EUR bn
Estonia
2.5
2.8
3.6
4.2
2002E
Population
in mn
1.4
FDI
per capita
in EUR
3,010
GDP
in EUR bn
FDI
in %
of GDP
6.2
68.1
Czech Republic
17.5
23.3
30.3
39.6
10.3
3,840
72.9
54.3
Hungary
19.1
21.3
25.9
27.3
10.1
2,710
66.5
41.1
Bulgaria
2.8
4.2
5.1
6.3
7.8
810
16.6
38.2
Slovakia
2.3
4.0
5.3
9.2
5.4
1,700
24.9
36.9
Croatia
4.1
5.6
7.5
8.1
4.4
1,830
23.7
34.0
Poland
38.7
53.1
61.1
65.9
38.3
1,720
199.9
33.0
Latvia
1.8
2.2
2.5
2.9
2.4
1,190
8.7
32.9
Lithuania
2.4
2.9
3.4
3.9
3.5
1,120
14.6
27.0
Romania
5.6
7.0
8.9
10.3
22.4
460
46.9
21.9
Slovenia
2.7
3.1
3.6
4.1
2.0
2,060
22.2
18.5
Sources: Austrian Federal Ministry of Economic Affairs and Labour; E: estimates of BA-CA Economics Department
Foreign Direct Investments1
Sectoral structure
Agriculture, hunting and forestry
Mining and quarrying
Manufacturing
2.5
%
0.0
39.4
0.7
2,351.1
40.6
Electricity, gas and water supply
11.7
0.2
Construction
38.1
0.7
724.4
12.5
37.5
0.6
Wholesale and retail trade
Hotels and restaurants
Transport, storage and telecommunications
Financial intermediation
Real estate, leasing and business activities
Health and social care
Other community, social and individual services
Source: Slovakian Statistical Office / 1) stocks as of 30.9.2002
6
USD million
746.4
12.9
1,629.8
28.2
185.0
3.2
2.2
0.0
16.8
0.3
Slovakia – from truant to star pupil?
As the most important privatisations have now been realised, inflows of direct investment will in the next few years
no longer match the levels reached in 2002. Follow-up and greenfield investments will nonetheless amount to
EUR 1– 3 bn each year. The significance of follow-up and greenfield investments has grown in the last few years. In
view of the favourable economic developments which are expected for Slovakia and what appears to be the gradual
formation of an automobile and electronic cluster in the region (Czech Republic, western Hungary, southern Poland),
this trend will also continue in the future. To date, more than 60 % of investments are concentrated in Bratislava. But
other regions such as Nitra and Banska Bystrice are likely to attract investors in increasing measure.
Although the privatisation process has passed its zenith, a number of projects are still outstanding. The government
is currently considering what should be done with the remaining majority shareholdings in SPP, the oil pipeline Transpetrol and the three electricity distribution companies. The discussions conducted in this regard could also influence the
privatisation of the Slovakian electricity company Slovenksa Elektrarne (SE). Since the privatisation of SPP generated
relatively large sums which can be used for the forthcoming pension reform, the government is considering the possibility
of taking a more cautious approach and waiting until the market recovers before proceeding with the privatisation.
Hans Holzhacker
Some important investments in industry
PSA Peugeot Citroen
It is envisaged that the new plant of the French automobile manufacturer in Trnava will be producing
300,000 cars annually from 2006. The construction of the plant will commence in September 2003. The project
will create 3,500 jobs and an additional 6,000 jobs among suppliers and for the purpose of meeting regional
demand. Investment volume amounts to EUR 700 mn.
Volkswagen
Volkswagen Slovakia was founded in 1991 by Volkswagen AG and BAZ (Bratislava Automobile Factories).
Today, Volkswagen Slovakia is wholly-owned by the Volkswagen group. In 2002 more than 225,000 vehicles were
produced in Slovakia, and 301,000 gearboxes. The company employs a workforce of 9,000 persons. 18.2 million
gearbox components were produced at the special production facility in Martin in 2002.
Matsushita
After a greenfield investment in 1998, the Japanese electronics company opened a second plant in 2002 with
annual output of 60,000 DVD players. Matsushita employs about 1,000 persons. The production programme focuses
on the manufacture of circuits and electronic components. Matsushita has invested some EUR 10 mn since 1999.
Woo One
The Korean company built a production facility for the manufacture of plastic casing for computer monitors
on the site which previously housed the plant of the refrigerator manufacturer Idaf. The company is planning to
invest EUR 10 mn in the next three years and will operate with a workforce of 300– 500 persons.
US Steel
In 2002, the largest US steel company took over the steel operations of the almost bankrupt eastern
Slovakian company VSZ, based in Kosice. With annual capacity of 4.5 million tonnes of raw steel, US Steel Kosice
accounts for about one-third of the capacity of the US Steel group. With a workforce of about 16,000 persons, the
company is one of Slovakia’s largest employers.
Gaz de France, Ruhrgas, Gazprom
In 2002, a 49 % stake in the “Slovakian Gas Industry” (SPP) was sold to a consortium of Gaz de France,
Ruhrgas and Gazprom, and general management control was conferred on the new shareholders. Gaz de France
and Ruhrgas currently each hold 24.5 % of the shares of SPP, and Gazprom has an option to purchase one-third
of their collective stake. Gasprom accounts for one quarter or 130 billion cubic metres of Europe’s gas imports,
of which a little over 70 billion cubic metres is carried by the pipelines of SPP.
Sources: Slovak Investment and Trade Development Agency (Sario), Slovak media reports
7
Slovakia – from truant to star pupil?
Euro: Introduction at the beginning of 2008?
The government declaration issued in November 2002 states that the Slovak government, together with the
central bank, wants to introduce the euro in 2006 given a favourable economic climate. However, the accession
date for the EU candidate countries has in the meantime been postponed to May 2004, and the countries must then
join the Exchange Rate Mechanism II (ERM II) before introducing the euro. From the central bank’s perspective,
the beginning of 2007 is therefore technically the earliest when the euro could be introduced. ERM II is the
“waiting room” prior to adoption of the euro, a time when the currencies of the accession countries may not
fluctuate by more than +/– 15 % for two years from a central parity in terms of the euro. The purpose of ERM II is
to determine whether the real economy and the financial markets are sufficiently aligned with those of the other
euro countries for the introduction of the euro to succeed in the long term.
Data from the Monetary Programme of Slovakia’s Central Bank
2002
2003
2004
2005
2006
4.2
4.4
4.6
GDP, real
% y/y
3.8
3.7– 4.1
Consumer prices
% y/y
3.3 – 3.4
8.2– 9.3
7.5
3.9
3.0
Current account balance
% of GDP
– 8.4
– 6.2
– 5.6
– 5.1
– 4.7
Budget deficit pursuant to Maastricht
% of GDP
– 7.8
– 4.9
– 3.8
– 3.3
– 3.0
Source: Slovak central bank
The data of the central bank’s monetary programme for 2003 and the forecast for the years 2004– 2006, which
are based on the government’s medium-term budget forecast, show that Slovakia ought to be ready to adopt the
euro in 2006: both inflation and the budget deficit, the two most difficult goals, are assumed to be sufficiently low
to meet the Maastricht criteria. In such a scenario Slovakia could from the viewpoint of the centralbank in 2007
submit an application for an extraordinary verification of its fulfillment of the convergence criteria, and then join
the monetary union at the beginning of 2008. However, the monetary programme also leaves open the possibility
that accession to the monetary union could already take place in 2007 if the budgetary goal is achieved earlier,
which would in turn accelerate the disinflation process. How realistic is such a scenario, and what could the rate
be, with which the crown will be converted into euros?
According to reports in the media, Marian Jusko, Governor of the Central Bank, stated on 22nd January this
year that Slovakia should adopt the euro at the same time as its neighbouring countries. If the forecasts of stronger
exports, improvements in the budget and sufficient growth should turn out to be true, the crown may gradually
strengthen before Slovakia joins ERM II, said the Governor.
In view of the substantial reductions that are required in the budget deficit (especially with the help of a
politically sensitive reform of the health sector), the parliamentary elections in 2006 and the slow approach in the
Czech Republic, we today consider 2008 as a realistic date for the adoption of the euro. The exchange rate of the
crown against the euro may have by then also strengthened somewhat. Chart 2 shows the appreciation of the
crown in real terms to date, and its further appreciation given a constant rate of exchange and inflation as
forecasted in the programme of the central bank. On account of the productivity gains which can still be achieved
by the Slovak economy, the real appreciation resulting from a fixing of the exchange rate and higher inflation than
in the EU would not present a problem. An appreciation in nominal terms, if not too high, would also not be a cause
for concern. This should not exceed 35 against the euro until 2008, or an average of about 2.8 % per annum. An
appreciation of the crown over and beyond this figure would impair the competitiveness of the Slovakian economy
and could require a painful adjustment-related recession. It may be assumed that the central bank will seek to
8
Slovakia – from truant to star pupil?
prevent such a strong appreciation, although this may not be too easy on account of the expected strong inflows of
foreign direct investment and short-term capital. A fundamentally different approach for accession to the monetary
union would only be possible if strong currency fluctuations also in other accession countries, which require
substantial efforts to keep the currencies in ERM II, convinces the EU that a shortening of the ERM II period and
a more rapid adoption of the euro would be simpler and less expensive for all concerned.
Exchange Rate of the Crown
25
2nd Dzurinda
government
1st Dzurinda government
30
1999 stability programme
35
EU invitation
40
45
50
55
1995
1996
SKK/USD
1997
1998
1999
2000
2001
2002
SKK/Euro
Real Effective Exchange Rate
150
May 2004
Accession to EU
140
1.1.2008??
Euro
130
May 2004??
Accession to ERM II
120
110
100
90
95
96
97
98
99
00
01
02
Assumed inflation: Slovakia: 2003:
2004:
2005:
2006:
Trading partner:
03
04
05
06
07
08
09
8.8%
7.5%
3.9%
3.0%
2%
Nominal effective rate assumed to be constant as from 2003
Hans Holzhacker
9
Slovakia at a glance
Slovakia at a glance
Structural Indicators
Area (km2)
49,034
Population in mn
5.4
President
Rudolf Schuster
Prime Minister
Mikulás Dzurinda
GDP (2002 in EUR bn)
20.8
Per capita GDP (2002 in EUR)
4,100
Exports in % of GDP
69.3
Economic Indicators
GDP real (yoy, in %)
Industrial output (real, yoy, in %)
1999
2000
2001
2002E
2003F
2004F
1.3
2.2
3.3
3.8
3.0
3.2
– 2.7
8.8
6.8
6.3
5.0
5.5
– 18.5
1.2
9.6
4.3
6.0
5.0
Consumer prices (yearly average)
10.6
12.2
7.1
3.3
8.1
5.3
Unemployment (yearly average)
17.5
18.2
18.3
17.8
18.0
17.8
Gross fixed capital formation (real, yoy, in %)
Budget balance (in % of GDP)
– 3.6
– 3.9
– 4.8
– 7.0
– 5.5
– 5.0
Merchandise exports (in EUR mn)
9,592
12,782
14,102
15,360
16,500
17,800
Merchandise imports (in EUR mn)
10,617
13,740
16,486
17,820
18,700
20,200
– 5.7
– 3.3
– 8.6
– 8.8
– 7.4
– 7.3
FDI (inflow, net in EUR mn)
666
2,077
1,674
4,020
1,400
2,000
Gross foreign debt (in % of GDP)
52.1
54.9
55.1
51.3
41.3
41.7
Current account (in % of GDP)
Average exchange rate: SKK/EUR
44.3
42.6
43.2
42.7
41.1
41.0
Average exchange rate: SKK/USD
41.4
46.2
48.3
45.1
39.8
40.2
E: BA-CA estimate, F: BA-CA forecast
Gross Domestic Product by Economic Sectors
2001
Agriculture and forestry
Industry
Construction
Services
10
4.1
24.4
4.6
66.9
HVB Bank in Slovakia
HVB Bank in Slovakia
Zilina
Zilina Branch
Zilina
Bottova 6
011 67 Zilina 1
Tel.: +421 41 7070 111
Poprad
Trencin
Banska Bystrica
Malacky
Trnava
Nitra
Bratislava
Dunajska Streda
Kosice
Zvolen
Banska Bystrica
Banska Bystrica Branch
Na Troskach 16
P.O.Box 509
974 01 Banska Bystrica 1
Tel.: +421 48 471 52 11
Zvolen
Zvolen Branch
Roznavska Branch
Headquarters
HVB Bank Slovakia a.s.
Mostova ul. 6
814 16 Bratislava 1
Tel.: +421 2 5969 1111
Fax: +421 2 5969 9406
Bank code: 8080
SWIFT: BACX SKBA
ICO: 31372503
DIC: 31372503/500
Bratislava
Mostova Branch
Roznavska 34
814 16 Bratislava 1
Tel.: +421 2 4341 0536
Zelezniciarska Branch
Zelezniciarska 13
814 16 Bratislava 1
Tel.: +421 2 5969 5256
Trnava
Trnava Branch
Hviezdoslavova 14
PO Box 108
917 01 Trnava 1
Tel.: +421 33 590 34 11
Dunajska Streda
Dunajska Streda Branch
Lazaretska Branch
Postova 1
929 01 Dunajska Streda
Tel.: +421 31 590 33 11
Lazaretska 24
814 16 Bratislava 1
Tel.: +421 2 5969 4253
Nitra
Nitra Branch
Westend Branch
Frana Mojtu 16
PO Box 57 D
949 01 Nitra 1
Tel.: +421 37 6920 711
Mostova 6
814 16 Bratislava 1
Tel.: +421 2 5969 2111
Westend, Dubravska 2
814 16 Bratislava 1
Tel.: +421 2 5941 8300
Pallehner Branch
Malacky Branch
Trencin
Trencin Branch
Hurbanovo sq. 1
814 16 Bratislava 1
Tel.: +421 2 5930 5411
Zahoracka 60, PO Box 31
901 01 Malacky
Tel.: +421 34 796 71 10
Pribinova 2
911 50 Trencin 1
Tel.: +421 32 7480 411
Hviezdoslavova 16
P.O.Box 78
960 01 Zvolen
Tel.: +421 45 524 14 11
Poprad
Poprad Branch
Namestie sv. Egidia 64
PO Box 119
058 01 Poprad 1
Tel.: +421 52 787 09 11
Kosice
Mlynska Branch
Mlynska 7
040 43 Kosice 1
Tel.: +421 55 7281 900
Sturova Branch
Sturova 14
P.O.Box B-45
041 25 Kosice 1
Tel.: +421 55 6112 501
www.hvb-bank.sk
HVB Bank is the fifth largest bank in Slovakia, with total assets of about 980 million Euro. It serves nearly
20.000 retail and corporate customers and holds a market share up to 4 per cent. HVB Bank is a universal bank,
serving corporate and retail customers, and offers additional financial services through its partners HVB Leasing
and CA IB Corporate Finance Advisory. HVB Bank holds a particularly strong position in corporate customer
business in Slovakia. One-third of Slovakia’s Top 100 companies are customers of HVB Bank in Slovakia. In retail
banking, the bank launched a process of fast expansion in 2002: it is planned to increase its network from currently
17 to 25 offices by the end of 2003.
Within the HVB Group, one of Europe’s largest banking groups, Bank Austria Creditanstalt is responsible
for the markets in Central and Eastern Europe. Its network comprises 900 offices in 15 countries and serves of
3.5 million customers. Bank Austria Creditanstalt’s know-how and quality of service have earned it a number
of awards. In 2002, the financial magazine Euromoney named Bank Austria Creditanstalt “Best Bank in CEE”.
The renowned publication The Banker rated the Group as “Bank of the Year 2002” in Central and Eastern Europe.
11