March 7, 2019 / 12:12 PM / a year ago

Slovenian banks' net profit rises 17 pct in 2018

LJUBLJANA, March 7 (Reuters) - Slovenian banks made a joint net profit of 496.3 million euros ($561.36 million) in 2018 versus 424.8 million a year before, partly due to a drop in bad loans, the Bank of Slovenia said in a report on Thursday.

The banks managed to reduce non performing loans to 1.7 billion euros or 4 percent of all loans at the end of 2018 versus 6 percent a year before.

“Last year was the fourth in a row in which banks posted profits,” the central bank said in its latest report on the country’s banks.

Slovenia only narrowly avoided an international bailout for its banks in 2013 when the government had to pour more than 3 billion euros into local banks to prevent them from collapsing under a large amount of bad loans.

The government still controls about 30 percent of the banking sector but plans to sell the country’s third largest bank Abanka by the middle of this year.

Slovenia has committed to sell a majority of the country’s largest bank NLB and the whole of Abanka in exchange for European Commission’s approval of state aid in 2013.

The banks’ balance sheet assets increased by 2.2 percent year-on-year while loans to the non-banking sector rose by 3.3 percent, the report said.

Other banks in Slovenia are mostly owned by foreign banks and investors, including U.S. investment firm Apollo Global Management, Societe Generale, UniCredit and Intesa Sanpaolo, Sberbank, Austria’s Sparkasse and Addiko Bank and Serbia’s AIK bank. ($1 = 0.8841 euros) (Reporting By Marja Novak. Editing by Jane Merriman)

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