The central bank wrote that the EUR 596 million in pre-tax profit recorded by banks in Slovenia last year had been a historical high and advised them to distribute this profit carefully now.
The drop in loan activity is expected to reflect in a decrease in net interest revenue, while the above average non-interest revenue seen last year would not have been repeated this year even in normal circumstances.
"The tough economic situation will impact impairment and provision costs and lead to a higher rate of payment defaults and a fast increase in expected losses arising from credit risk," Banka Slovenije wrote.
As for January, the central bank reported EUR 15.4 million in pre-tax profit for banks in Slovenia, a 61% decrease year-on-year.
It pointed out that the net easing of impairments and provisions that also marked last year had practically ended.
Total assets of the banking system rose to EUR 41.7 billion in January. Year-on-year growth increased to 7%.
The volume of loans increased by EUR 239 million in January, "the biggest net increase since June last year", Banka Slovenije pointed out.
Loans to companies accounted for EUR 203 million, a 5.2% year-on-year increase, while loans to households were up 5.9% after growth started to cool off towards the end of 2019.
Consumer loans growth was down to 7.7% and housing loans growth stayed at 5.6%, trends the central bank pointed out were a result of the brake it pulled in this segment in November last year.
"In the current circumstances were are unable to asses what effect the coronavirus situation will have on loans to households."
Meanwhile, exposure to non-performing loans was down further to 2.2% or to under EUR 1 billion, a trend that could be reversed as a result of the crisis.
Non-banking deposits were up 7.5% in the past year until the end of January, with their growth exceeding that of the increase in total assets.
Total capital adequacy rose to 18.5% in January, and the tier 1 capital ratio to 17.8%, meaning both exceeded the eurozone average.