EN ECB-PUBLIC  
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 2 April 2013  
on special mortgage transactions 
(CON/2013/23) 
 
Introduction and legal basis 
On 1 March 2013, the European Central Bank (ECB) received a request from the Slovak Ministry of 
Finance for an opinion on a draft law amending Law No  483/2001 on banks (hereinafter the ‘draft law’). 
The ECB’s competence to deliver an  opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union and the sixth indent  of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions1, as the draft law relates to rules applicable  to financial institutions insofar as they 
materially influence the stability of financial ins titutions and markets. In accordance with the first 
sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council 
has adopted this opinion. 
 1.  Purpose of the draft law 
The purpose of the draft law is, inter alia , to curtail foreign banks’ entitlement to carry out special 
mortgage transactions covered by the banking licence through their branches in Slovakia
2. Special 
mortgage transactions comprise: (a) the provision of mo rtgage loans and the related issuance of mortgage 
bonds; or (b) the provision of municipal loans and the related issuance of municipal loans3. The proposed 
amendment aims at protecting consumers and other c lients, since Národná banka  Slovenska has limited 
supervisory powers over branches of foreign banks as compared to banks. In the event that the draft law 
were adopted, only banks could carry out special mortga ge transactions in Slovakia. However, branches 
of foreign banks would continue to be entitled to provide common mortgage loans4. The draft law also 
contains a transitional provision covering situations  where a bank which has performed special mortgage 
transactions ceases to exist and its legal successor is a foreign bank5. Furthermore, the draft law also 
provides that a bank has a duty to notify its clie nts of its intention to terminate its activity6. 
                                                 
1  OJ L 189, 3.7.1998, p. 42. 
2  Article I (3), (6), (7), (8) and (61) of the draft law. 
3  Article 67(1) of Law No 483/2001 on banks. Pursuant to Artic le 2(1), a bank is defined as a legal entity with its 
registered office in the territory of the Slovak Republic, f ounded as a joint-stock company,  which (a) accepts deposits, 
and (b) provides loans; and which holds a banking li cence to perform activities noted in paragraph 1. 
4  See the specific part of the explanatory memorandum to the draft law, explanations to Article I (3), (6), (7) and (8). 
5  Article I (11) of the draft law. 
6  Article I (16) of the draft law. 
ECB-PUBLIC  
2  
2. Freedom of establishment  
The consulting authority should ensure that the draft la w does not restrict  the freedom of establishment of 
Union credit institutions7 in Slovakia as exercised through the setting up of  branches and, in particular, 
the conduct of activities subject to the principle of mutual recognition8.  
 This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 2 April 2013. 
 
[signed] 
 
The President of the ECB 
Mario DRAGHI 
  
                                                 
7  Title IV, Chapter II, Articles 49-55 of the Tr eaty on the Functioning of the European Union. 
8  See Article 23 in conjunction with Annex I to Directive 2006 /48/EC of the European Parliament and of the Council of 
14 June 2006 relating to the taking up and pursuit of the business of credit institutions (recast) (OJ L 177, 30.6.2006, 
p. 1).