Cechova & Partners Partner Michaela Jurkova and Ruzicka & Partners Partner and Co-Head of the Banking and Finance practice Jan Hanko discuss Slovakia’s banking sector’s modest but meaningful consolidation over the last five years.
Slovak Banking Today
Consolidation has steadily reduced the number of banks and branches since 2020. “The Slovak banking sector is considered one of the most stable in the European Union,” Jurkova begins. “According to the official statistical data, the number of banks and foreign bank branches (both referred to as entities) in Slovakia decreased from 28 to 23 during the monitored period of March 2020-March 2025.” According to her, in 2020, there were “two banks with Slovak capital, 10 banks with foreign capital, and 15 branches of foreign banks. By March 2025, however, only one bank remained with Slovak capital, while nine banks had foreign capital, and 12 branches of foreign banks were operating.”
“The number of commercial banks operating in Slovakia is gradually decreasing,” Hanko chimes in. “In 2020, there were 27 banking institutions, out of which 12 were banks and 15 branches of foreign banks. In 2025, the number dropped to 22 institutions, 10 banks, and 12 branches of foreign banks. Three branches of foreign banks terminated their activities in Slovakia, and two banks have merged.”
Major Mergers and Deals on the Horizon
Two high-profile transactions have reshaped market share and set the stage for further consolidation. “The first merger took place in 2021, when the Belgian KBC Group acquired OTP Banka Slovensko from the Hungarian OTP Bank,” Jurkova explains. “The KBC Group then merged OTP with its subsidiary, CSOB, thus combining its two subsidiaries. KBC’s acquisition of OTP was driven by the desire to strengthen KBC Bank’s position in the Slovak market,” Jurkova adds. “The second merger occurred in 2023, when CSOB Stavebna Sporitelna, merged with CSOB. This was the result of a change in legislation that allowed building societies (building savings banks) to merge with banks.”
Indeed, it appears that KBC has made consolidation its hallmark strategy. “The key player in the Slovak banking market in recent years in terms of acquisitions and mergers has been the KBC Group,” Hanko notes. Commenting on all of the bank’s activities, Hanko says that “KBC Group proves its determination for continuous growth and strong presence in the Slovak banking market.”
Still, the next wave of consolidation seems to already be in the pipeline, pending approval. “KBC Bank NV and J&T Finance Group SE have reached an agreement for KBC to acquire a 98.45% stake in 365.bank, a Slovak commercial bank with a 3.7% market share,” Jurkova reports. “According to a joint press release by KBC and J&T, combining CSOB and 365.bank will increase CSOB’s market share in retail loans and mortgages to 20%, while also benefiting other CSOB Financial Group entities by enabling them to cross-sell their products and services to 365.bank’s retail customer base. The transaction is currently pending regulatory and anti-trust approval, and is expected to be completed by the end of 2025,” Jurkova explains.
A matching announcement confirms the deal’s rationale. “The share purchase agreement for the acquisition has already been signed and the transaction will be closed by the end of 2025 following regulatory approvals,” Hanko reports. “KBC Group acquires 365.bank to strengthen its position in the retail segment and access the unique distribution network of 365.bank, providing financial services through post offices.”
Regulatory and Economic Tailwinds
“As mentioned, the Slovak banking sector was relatively stable during the monitored period with only a limited number of mergers taking place,” Jurkova says. “The reason may be the small size of the Slovak market, but also the combination of regulatory, technological and economic challenges that Slovak banks have faced during recent years, requiring them to adapt their strategies and investments.” According to her, the Slovak banking sector currently has one of the highest tax burdens in the European Union mainly due to the “high special levy imposed on Slovak banks, which may also cause foreign bank branches to leave the market.”
Looking ahead, economic pressures could both drive and delay deal-making. “A worsening of the business environment and economic situation in Slovakia may force banking institutions in Slovakia to further consolidate,” Hanko opines. “It is expected that banks will face decreased interest revenues and higher losses from loan defaults. At the same time, banks will need additional investments to keep up with the pace of developments in areas such as AI, cybersecurity, ESG, and regulatory requirements,” he explains. These factors may encourage banks to seek synergies and forms of cost reduction by means of mergers or acquisitions. “On the other hand, global economic and political uncertainties may slow down the progress of such transactions.”
Legal Checklist for M&A
Both Jurkova and Hanko highlight that advising on these bank deals brings its own set of Slovak-specific rules and approvals.
“In addition to the usual challenges of managing complex due diligence, cross-border legal issues, data protection, and employment matters, banking M&As present further difficulties due to the unique legislation concerning banks,” Jurkova argues. “For example, prior approval from the National Bank of Slovakia is necessary for acquiring certain thresholds in the registered capital of a Slovak bank, as well as for any merger involving a Slovak bank. Similarly, antitrust approvals may be required if the transaction meets the thresholds of the applicable merger control legislation.” Recently, Jurkova reports, Slovak lawyers have also had to deal with “new legislation that regulates the transformation of corporate entities in general, including M&As.”
However, procedural reforms are streamlining deals. “There are no significant obstacles in this respect,” Hanko adds in the end. “The legal and regulatory environment for merger and acquisition transactions is established, and the deals can be completed in a reasonable time. In 2023, a new Act on Transformation of Companies was adopted in Slovakia, implementing EU laws and which is now being put into practice, and which is aimed at further improving the legal procedures for merger transactions.”
This article was originally published in Issue 12.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.
