Principle of one Licence

The new Banking Act introduces, with the effects from the validity date of the Agreement on Accession of the Slovak Republic to the EC, the so-called principle of one licence, pursuant to which a foreign bank with its registered seat in the territory of a member state of the EC is allowed to perform banking activities in the territory of the Slovak Republic through its branch office (save for mortgage transactions and performance of the function of custodian under the Act on Collective Investments) without a Slovak banking licence provided that an authorisation for performance of these activities was granted to such foreign bank in the respective member state of the EC. For such performance of banking activities a positive statement of the banking supervision authority of the relevant member state delivered to NBS shall be required.

Such foreign bank shall be entitled to perform these banking activities also without establishing a branch office, on that basis that a written notification to the banking supervision authority of the relevant member state of contemplated banking activities is delivered to NBS before the realisation of the first banking transaction. This will enable such foreign bank to provide banking services e.g. by means of the internet.

It will be possible to apply the principle of one licence also for foreign financial institutions with their registered seat in the territory of a member state of the EC, which are subsidiaries of the given foreign bank, eventually of two or more foreign banks subject to fulfilment of all requirements specified in the new Banking Act.

A foreign bank which does not use advantages of one banking licence under the law of the EC, or a bank with its registered seat in the state which does not use advantages of one banking licence under the law of the EC, is not allowed to perform banking activities in the territory of the Slovak Republic through its branch office without obtaining a banking licence.

However, a banking licence of NBS shall be always required for execution of mortgage transactions and a function of custodian under the Act on Collective Investments.

A similar system shall be in force from the effectiveness of the Agreement on Accession of the Slovak Republic to the EC also for a bank with its registered seat in the Slovak Republic, which wishes to perform banking activities in the territory of the other member state (save for mortgage transactions and a function of custodian) directly without the establishment of a branch office and also for a financial institution with its registered seat in the territory of the Slovak Republic which is a subsidiary of one or more banks.

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