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Slovakia – HVB Bank Slovakia
€ m 2005 2004
Total assets 2,010 1,638
Net income before taxes 21.0 20.1
ROE before taxes 10.4 % 11.9 %
Cost/income ratio 52 % 51%
Employees (full-time equiv.) 443 437
Offices 27 27
In 2005, Slovakia’s economy
grew by 5.6 %, thereby
again outperforming the
other new EU member states.
Bratislava
There was a sharp decline in the
general price increase, to a level of 2.7 % compared
with 7.5 % in 2004. Economic growth was largely supported
by private consumption; moreover, investments (car plants of
PSA and Kia) and net exports showed rising trends. As in the
previous year, private customer business accounted for a significant
portion of lending growth, with particularly strong
demand for housing loans. On the other hand, private customer
deposits declined slightly. The recovery in business lending
reflected the general upswing in corporate investments. At
the end of November, Slovakia brought the date of entry into
ERM II forward from mid-2006, a move which further
strengthened the Slovak currency. Interest rate levels remained
constant almost throughout 2005. From the beginning of
March, the central bank’s key interest rate was 3 %.
In an extremely difficult environment characterised by excess
liquidity and narrowing margins, our banking subsidiary in Slovakia
held its own in 2005. With a market
www.hvb-bank.sk
share of 5 % we are number 6 on the Slovak
banking market. Net income before taxes was 1% higher than
a year earlier, despite one-off costs relating to the forthcoming
merger with Unibanka. Strict cost management helped to
keep the cost/income ratio at 52 %.
Business structure and development
Retail customers
We aim to enhance our market position in retail banking in
Slovakia, too. Overall, private customer business developed
very favourably in 2005. The number of customers rose by
36 % to 35,692 customers. We are expanding alternative sales
channels to complement the branch network. Cooperation
partners who are assigned to specific branches and operate
under the name of HVB Bank Partner offer cashless services
and loan products such as mortgage loans and HVB credit
cards.
Mortgage loans have become one of our most successful retail
products. In 2005, the volume of mortgage loans outstanding
increased by about 40 % to SKK 1,259 m. Some 40 % of our
mortgage products are sold via alternative sales channels.
On its website HVB Bank Slovakia offers various online application
forms which, when completed by private or business
customers, can be directly imported to the bank’s systems. This
interactive function simplifies and accelerates the entire application
process. The tool also offers assistance to customers,
e.g. a loan calculator to find the most advantageous HVB
product solution for business loans.
Corporate customers
With a market share of 13 %, we are among the leading
banks in the Slovak corporate banking sector. In 2005 we
again demonstrated our recognised structured financing
expertise in the largest loan transaction in Slovakia to date: as
Mandated Sole Lead Arranger we placed a syndicated loan
amounting to SKK 15 bn for Slovakia’s national motorway
company.
The “Award for Excellence in Real Estate Commercial Banking
in Slovakia” from Euromoney underlined our leading position
in the area of commercial real estate finance in 2005.
Favourable economic conditions in Slovakia are attracting
increasing numbers of foreign investors, primarily companies
in the automotive sector. In this environment, personal commitment,
product quality and a focus on customer service
have proved to be specific assets of our Group: the corporate
finance specialists of the Korean Desk succeeded – not least
because of their knowledge of the language – in acquiring the
partial financing of the European manufacturing plant of Kia
Motors Corporation.
Our other Slovak subsidiaries also operated successfully in
2005. The factoring company which we established in the previous
year broke even in the third quarter of 2005. And with
CAC Leasing we are the leading universal provider of leasing
services in Slovakia.
Outlook
2006 will see the merger of HVB Bank Slovakia and Unibanka,
creating the fourth-largest bank in the country with about 100
branches. Activities will concentrate on further enhancing the
market presence, especially in business with small and medium-sized
companies. In the retail customer segment, business
volume and the customer base will be considerably expanded,
with a focus on credit card business.
CEE Network of Bank Austria Creditanstalt in 2005 83