Limits on deposit rates

The Bank of Slovenia introduced an instrument in March 2012 to limit deposit rates. This measure is implemented as part of the internal capital adequacy assessment process-supervisory risk evaluation process (ICAAP-SREP) process and defines a premium on capital requirements for new deposits by the private non-banking sector where the realised deposit interest rate exceeds the ceiling set by the instrument.

The Bank of Slovenia introduced the instrument with the aim of mitigating income risk in the context of an excessive increase in interest rates on deposits by the non-banking sector. The measure as adopted should encourage banks to exercise even greater caution in the management of levels of deposit interest rates, which should have a positive impact on lending rates.

The Governing Board of the Bank of Slovenia took the decision to introduce the instrument at the 458th meeting of the Governing Board of the Bank of Slovenia on 28 February 2012. The measure entered into force at the beginning of March 2012. The methodology for calculating the premium on risk-based capital requirements is described in the Bank of Slovenia guidelines for banks and savings banks on the internal capital adequacy assessment process.