The International Monetary Fund (IMF) has said that Austrian banks are very vulnerable in the Eastern Europe countries; hence reforms on work incentives along with the reforms on pensions and subsidies are needed.

In a report, IMF has stated the large banking sector of Austria is at risk in southeastern, eastern and central countries, as there is still volatility in the global and eurozone markets. The amount of exposure Austrian Banks internationally have is worth 105% of Austrian Gross Domestic Product.

"The post-election agenda should focus on further enhancing financial sector resilience, strengthening public finances and boosting potential growth," said the report.

It is mentioned in the report that the practical and efficient macroeconomic management by the Austrian Government has helped the country to perform well, thus it needs to be cautious in future as well. The report emphasized on the reforms in pension and health sector, as the current policies are very complex and costly in nature. The elections in Austria are scheduled for September 29.

IMF has advised the large scale banks to work on the risk management strategy and also to make their capital buffers better, especially in the wake of Volksbank and Hypo Alpe Adria bank incidents. These banks were nationalized due to the huge expansion in the eastern countries.