May 30, 2018 / 12:20 PM / a month ago

Slovak financial sector resilient, economy showing overheating signs - central bank

BRATISLAVA (Reuters) - The Slovak financial sector is resilient to any potential shocks and the economy is starting to show signs of overheating, the Slovak National Bank said on Wednesday in an annual financial stability report.

The central bank said foreign owners of Slovak banks will need to apply a more conservative dividend policy to meet rising capital demands.

It reiterated it was ready to increase the countercyclical buffer rate for banks if needed, even as soon as taking a decision in July, to get ahead of strong growth in lending to households that is maintaining a double-digit pace.

Slovakia’s banks, including CSOB (KBC.BR) , Postova Banka, Slovenska Sporitelna (ERST.VI), Tatra Banka (RBIV.VI) and VUB (ISP.MI), are largely foreign-owned and have avoided troubles seen by other banks in Europe in the decade since the global financial crisis.

Reporting by Tatiana Jancarikova, writing by Jason Hovet

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