State banks are proceeding correctly with risky receivables, the SAO would like to strengthen its audit authority

Bratislava, December 16, 2022 – The risk receivables management system is operational in two state banks, Eximbanka and Slovenská záručná a rozvojová banka (SZRB – the Slovak Guarantee and Development Bank). This results from the audit of the Supreme Audit Office (SAO) of the Slovak Republic in these specialized financial institutions. The auditors looked at the years 2019-2021, and found no violation of applicable legislation or internal regulations in the collection and processing of receivables and the write-off of uncollectible ones on a selected sample of risky receivables. "Both of these banks have a functional system for monitoring and solving risky receivables, which enables timely recovery processes or their recovery," stressed the vice-president of the SAO, Jaroslav Ivančo. He also appreciated the functional internal audit and internal rules of these banks. "Dealing with risky receivables is never a subjective decision of one employee, but a collective decision of a labor body with decision-making authority," added the vice-president of the audit office.

Despite the positive findings, the Supreme Audit Office still sees possibilities for further improvement of the audit of both institutions. In the case of SZRB, it recommends the Parliamentary Committee for Finance and Budget to request the Ministry of Finance of the Slovak Republic to initiate changes to the Banking Act. "According to the Act on the SAO, auditors are bound by banking secrecy and therefore should have access to it. However, due to the current text of the Act on Banks, they are limited in their ability to audit bank receivables in the SZRB," the vice-president of the audit office pointed out. “It would be good to solve this legislative problem”, he added. In relation to Eximbanka, the national authority for external audit recommends adopting a systemic measure in the area of ??regulation of the bank's activities and thus contribute to further reducing the risk of closing deals and activities threatening its financial stability and performance.

The full text of the press release about this issuin Slovak language is available here. Use the Google icon in the top bar for automatic translation.