Commenting on the results of the net profit, Zarko Primorac, the chief-editor of the 'Banke' special publication of the Privredni Vjesnik journal and the Croatian Chamber of the Economy, said on Wednesday that the Croatian banking sector had become one of the most profitable banking sectors in countries in transition.
However, Croatia also holds a record according to the share of the foreign debt in Gross Domestic Product (GDP), and banks in Croatia have over three years become the leading sector in the increase of the country's foreign debt, accounting for 34 percent in the debt, Primorac said.
The analyst said that it was not entirely correct to claim that the foreign ownership of banks in Croatia was the main cause for the rise in banks' debts, as domestic banks behaved in the same manner,
Primorac said that the measures of the Croatian National Bank (HNB), aimed at curbing the debt, should not be used by commercial banks to increase interest rates as their profitability proved that something like that was not necessary.
Banks just like entrepreneurs have used all possibilities, and one of the basic generators of the rise in the debt is inclination toward excessive spending at all levels, starting from citizens, companies to the state, he explained.
Corroborating his statement, Primorac cited figures of a 50-percent share of loans granted to citizens in all loans n 2004.
Of 141.07 billion kuna granted last, 62.8 billion were given to citizens and 58.88 billion kuna to the economy.
For the 13th consecutive year the special publication carries the rankings of the banks according to their performance.
The so-called Six Big banks - Zagrebacka, Privredna, HVB Splitska, Erste & Steiermaerkische, Hypo Alpe-Adria-Banka and Raiffesenbank - remained at the first six places, accounting for 88 percent of the banking sector's profit, 82-percent in assets and approved loans and 80 percent in citizens' saving last year.