Lithuanian Railways with EUR28m fine from the European Commission

Lithuanian Railways (hakzelf, CC BY)

Moody’s: Hungary’s banking sector with positive outlook

29 per cent of the young Slovaks want to leave the country for good

Lithuania

The state-owned company Lithuanian Railways (Lietuvos Geležinkeliai) were fined by the European Commission (EC). The company will have to pay EUR27.87m for “restricting competition by dismantling a railway stretch between Mažeikių and the Latvian town of Renge in 2008”. The company was also obliged to remover the breach.

The EU Competition Commissioner Margrethe Vestager has commented that “It is unacceptable and unprecedented that a company dismantles a public rail infrastructure to protect itself from competition”. At the same time Lithuanian Prime Minister Saulius Skvernelis said Lithuania “would use all the legal possibilities to prove its truth”. The Delfi agency reports that the company can appeal against the fine to the Luxembourg-based Court of Justice of the European Union.

The dismantling of the railway was reported to Brussels by Latvia and Poland’s PKN Orlen, owner of Orlen Lietuva based in Mažeikių.

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Hungary

The situation in Hungary’s banking sector is stable, although its profitability is likely to decline to “more moderate levels over the next 12-18 months”. In 2017 no one-off gains, like those occurred in 2016, are expected. The provisioning is higher, the interest rates are lower and the credit growth is modest. Nevertheless, Moody’s Investors Service has maintained its positive outlook on the country’s banking system.

The agency points out that in the following months the loan quality and the profitability of the sector will be bolstered by Hungary’s improving economy, and adds that capital buffers remain stable.

As the Budapest Business Journal reports, the sector becomes healthier. Moody’s expects NPLs to fall to 9 per cent of total loans by the end of 2018 (from 14.7 per cent by the end of 2016), which will be “driven mainly by sales and write-offs of problematic loans”.

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Slovakia

The Slovak Spectator reports that young Slovaks do not trust their country’s institutions and plan their careers outside of Slovakia. According to the survey conducted by the Slovak Youth Council in the Visegrad Group (V4) “More than one-quarter of them plan to go abroad in the next three years”. Also 29 per cent claim they plan to leave Slovakia for good.

80 per cent of respondent do not trust the government and the parliament, and 67 per cent do not trust courts. They feel they have no influence over what’s happening in their society and the country they live in. Youth unemployment in Slovakia is 16.2 per cent of active population.

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What’s up in indexes

BET (of Bucharest) decreased from 7,894.26 index points Monday, October 2nd to 7,888.01 index points Tuesday, October 3rd. It’s down 0.06 per cent d/d and up 13.39 per cent y/y.

BUX (of Budapest) increased from 37,751 index points Monday, October 2nd to 37,908.57 index points Tuesday, October 3rd. It’s up 0.42 per cent d/d and up 35.33 per cent y/y.

CROBEX (of Zagreb) decreased from 1,807.53 index points Monday, October 2nd to 1,805.23 index points Tuesday, October 3rd. It’s down 0.13 per cent and down 7.09 per cent y/y.

OMXR (of Riga) decreased from 998.65 index points Monday, October 2nd to 994.34 index points Tuesday, October 3rd. It’s down 0.43 per cent d/d and up 41.30 per cent y/y.

OMXT (of Tallinn) increased from 1,213.09 index points Monday, October 2nd to 1,216.42 index points Tuesday, October 3rd. It’s down 0.27 per cent d/d and up 21.42 per cent y/y.

OMXV (of Vilnius) increased from 643.85 index points Monday, October 2nd to 646.47 index points Tuesday, October 3rd. It’s up 0.41 per cent d/d and up 19.04 per cent y/y.

PX (of Prague) increased from 1,050.74 index points Monday, October 2nd to 1,051.20 index points Tuesday, October 3rd. It’s up 0.04 per cent d/d and up 21.02 per cent y/y.

SAX (of Bratislava) closed at 317.78 index points Tuesday, October 3rd. It’s the same result as Monday’s. It’s up 1.12 per cent y/y.

SOFIX (of Sofia) decreased from 687.75 index points Monday, October 2nd to 680.67 index points Tuesday, October 3rd. It’s down 1.03 per cent d/d and up 34.24 per cent y/y.

UX (of Kyiv) increased from 1,219.36 index points Monday, October 2nd to 1,235.20 index points Tuesday, October 3rd. It’s up 1.30 per cent d/d and up 51.81 per cent y/y.

WIG20 (of Warsaw) closed at 2,469.58 index points Tuesday, October 3rd. It’s up 43.12 per cent y/y.

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