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Financial Stability Report - November 2025

DESPITE UNCERTAINTY, THE FINANCIAL SECTOR REMAINS STABLE

The Slovak economy is confronted with increased uncertainty; global trade tensions and fiscal consolidation are slowing its growth

Both firms and households are facing this challenging period on a sound footing, and banks remain robust

Mortgage demand is rising despite lower housing affordability, but corporate lending has slowed amid a subdued economic outlook

Both the domestic and global economies are enveloped by uncertainty

Trade tensions and growing competition from China are undercutting European exports. In financial markets, imbalances and the risk of a substantial decline in asset prices persist. The domestic economy is slowing, especially in industry, where both exports and revenues fell in August. In an environment of heightened uncertainty, it is crucial to put public finances on a sustainable path, although the necessary fiscal consolidation continues to hold back the economy.

Initial positions are strong

Slovak firms and households remain in a solid financial situation, and non-performing loan ratios are low. However, interest rates are still elevated, and so the sensitivity of indebted groups to adverse developments remains high.

Banks are profitable, well-capitalised, and resilient to shocks. Growth and stability continue to be the trends for insurers as well as for pension and investment funds. The current macroprudential policy tools are appropriately configured for existing risks and do not require adjustment.

Mortgage growth has accelerated

The number of newly originated mortgages has returned to its long-term average, and the average loan amount is rising in line with higher housing prices. Although housing affordability remains lower, the mortgage market is growing due to increasing shares of higher-income borrowers and borrowers using additional financing from other sources.

Lending to the corporate sector slowed slightly after picking up early in the year, consistent with deteriorating economic conditions.

Also in this edition

  • Stablecoin risks from a financial stability perspective
  • How was housing acquired in 2024
  • The changing importance of firms’ competitiveness in a global context
  • How the completion of Basel III implementation has affected Slovak banks
  • The impact of climate risk on financial stability in Slovakia