Opinion of the European Central Bank of 2 April 2013 on special mortgage transactions (CON/2013/23)
Date: 2013-04-02
Institutions: European Central Bank
Subjects: Slovakia, bank, consumer protection, financial stability, mortgage, national law

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  Central  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  institutions  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  Slovakia2.  Special 

mortgage transactions comprise: (a) the provision of mortgage 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 clients, 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 mortgage 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 clients of its intention to terminate its activity6. 

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2  
3  

4  
5  
6  

OJ L 189, 3.7.1998, p. 42. 
Article I (3), (6), (7), (8) and (61) of the draft law. 
Article  67(1)  of  Law  No  483/2001  on  banks.  Pursuant  to  Article  2(1),  a  bank  is  defined  as  a  legal  entity  with  its 
registered office in the territory of the Slovak Republic, founded as a joint-stock company, which (a) accepts deposits, 
and (b) provides loans; and which holds a banking licence to perform activities noted in paragraph 1. 
See the specific part of the explanatory memorandum to the draft law, explanations to Article I (3), (6), (7) and (8). 
Article I (11) of the draft law. 
Article I (16) of the draft law. 

 
 
 
 
                                                 
ECB-PUBLIC 

2. 

Freedom of establishment 

The consulting authority should ensure that the draft law 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  
8  

Title IV, Chapter II, Articles 49-55 of the Treaty on the Functioning of the European Union. 
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). 

2