Banks fear credit squeeze

Slovenian banks are sounding the alarm and urging the central bank to ease lending conditions after a significant increase in the minimum wage and new capital requirements have rendered much of the population ineligible for a mortgage.

The central bank imposed relatively high capital demands for home mortgages at the start of 2023, whereas the increase in the minimum wage, by €100 net to €878 net, means that the amount of credit households are eligible for has contracted substantially.

An individual must have 76% of gross minimum wage left after paying their loans. This...