Monday, 28 July 2008

Surely they ARE crazy - Slovakia's Price Board before euro adoption

For personal and business reasons I try not to follow current Slovak news in detail. But occasionally a detail passes through the filters...

The Slovak government is excessively concerned about businesses abusing the currency change to increase prices.

In comes the price board. They will clamp down on them Euro-introduction profiteers! The Minister of Finance will report to the board monthly and the board will take action should a business try to increase its prices around the end of 2008.

At least the government gave up on trying to make price manipulations during switch to the euro a criminal offense.

Slovakia will officially adopt the Euro on January 1, 2009. For two weeks both the Slovak crown (koruna) and the Euro will be used. The exchange rate was fixed in July to SKK 30.126 to the Euro.

Friday, 11 July 2008

Markets are tough, Slovak bank clients learn

Before the Slovak crown's exchange rate to the Euro was fixed (to 30.126 crowns per euro) two major Slovak banks offered clients deposit instruments with high guaranteed interest rate.

Of course there was a reason these deposits carried rates over 5%, well over one percentage point above any other similar guaranteed deposit. The deposits included a speculation on the Slovak crown's eventual fixed rate to the Euro.

In July the exchange rate was revealed. The crown ended up stronger to the Euro than most had expected even a few months ago. Suddenly, Slovenska Sporitelna bank Grand deposit clients are finding out that they will be making their 5+ % interest but their deposit will be converting at the fixed rate of SKK 32.5 per EUR (the same rate applies to clients of the "Premiovy vklad" at Slovak Volksbank).

At Slovenska Sporitelna a 100,000 Sk in the Grand Vklad (which also drew a 500 Sk fee at the start) will become EUR 3,231. Had they kept their cash under the mattress they would be converting to EUR 3,319 (via eTrend). Aside from the fact that these deposit reportedly attracted about 3 billion crowns, a 2.65% loss is not a bad price to learn a bit about how the markets work.

People and companies are coming forward claiming they were not properly shown or explained the fine print. The obvious lesson: if it sounds too good to be true (or is so much more attractive than the competition in a relatively competitive market) there is a risk. And risks sometimes do materialise.

Thursday, 10 July 2008

When you get sick in Croatia, do as the Croats do?

Once on a trip to Croatia one of the group needed treatment for a sore throat. A friendly seaside town pharmacist matter-of-factly recommended propolis drops. Croats take them and apparently experience relief.

In Slovakia we use an aluminium acetate and tartrate ointment (a vinegar and wine-related substance, judging by name) to treat swelling. Fair enough, except the internet only contains some 20+ references to the compound by its Latin name, all coming from Czech pharmacies. Does not seem to be used anywhere else.

I am not talking grandmother's recipes rakija compresses here (traditional wine brandy compress used in Croatian homes to reduce fever) but the kind of stuff a doctor prescribes and pharmacist recommends.

You can only dream of what health benefits would come from interchange of these guaranteed-to-work 'national' remedies.

Tuesday, 8 July 2008

Tatra Banka, careful about any single-sided moves!

I have complained about Tatra Banka's new, secure but user-unfriendly "solution" for logging into its Internet Banking: the Tatra Banka Card & Reader (I have even had to apologise for insulting Tatra Banka's PR agency, because I had thought anyone writing favourably about the card & reader must have been paid off).

I never activated my card & reader after learning I would never be able to deactivate it again - I will not let my bank force me to lug around a calculator that doesn't fit my wallet just because they think it's secure.

Things have been pretty quiet on the Card & Reader front since the initial campaign introducing the ugly device. I sort of hoped the bank had backed down after learning customers were not all that excited about the new "solution". I noticed they started putting the calculator inside their branches in a glass case on a marble pedestal, which was exactly where I thought the device belongs.

Suddenly, in language reminiscent of orders from the politbyro I learn that Tatra Banka is going to force clients onto the new solution: they have issued "binding procedures" with the threat of "unilateral automatic changes by the bank" (that's my translation, their translator says "the mentioned settings can be changed automatically by bank single-sided." - their bold)

Here is my pledge: once you try this on me I will automatically and single-sided close my current account, move my mortgage to mBank (which can authenticate me pretty well without any stupid devices), return my credit card and never look back.