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Management style
allows for quick
decisions
Investkredit as
quality leader
among Austrian
banks (TOP 2000)
Difficult market
environment due to
simultaneous
economic contraction
in Europe, the USA
and Japan
Management discussion
consistently seek appropriate combinations of risk and income profiles
broaden and deepen customer relations by providing continuity, know-how and innovative
approaches
reach a sustainable increase in return on equity approaching the 15% mark
further reduce the cost-income ratio to less than 40% by 2004.
REALISATION OF STRATEGY. Investkredit’s management team meets on a monthly basis to discuss
the ways and means for a proper realisation of strategy. In addition, an elaborate internal reporting
system allows for fine-tuning existing measures, as well as for quickly adjusting strategy to
changed market conditions. Open and transparent disclosure and reporting practice is one of the key
principles of the Bank’s management style. Department heads meet with the members of the Board
on a daily basis, thus enabling it to reach important business decisions within one day.
Market share among Austrian
corporates
Turnover
Investkredit‘s
market share
over
EUR 40 m
2
over
EUR 7 m
nd largest
bank
3rd OUR CUSTOMERS. In 2001, Austrian banks once
again commissioned the independent financial consultancy
firm Schwabe, Ley & Greiner to conduct a
survey among 3,850 corporates with a turnover of
between roughly EUR 7 m and EUR 40 m (the TOP
2000 survey of 2001). The survey shows that approximately
9% of all medium-sized corporates
belong to Investkredit’s customers. With a share
1,100 corporates
of 6%, Investkredit Bank AG continues to hold
3,850 corporates
largest
third position in the TOP 2000 list when it comes
to long-term financing. In addition,
Investkredit’s market shares have proved extraordinarily
stable during the rather turbulent develop-
bank
ments on the Austrian banking sector. According to the TOP 500 survey carried out in 2000 among
1,100 large corporates with a turnover of more than EUR 40 m, Investkredit is the second largest
long-term loan financier in this customer group. The Bank’s services, however, do not only consist
in long-term financing but also – to an ever increasing extent – in asset management, interest-rate
and currency management. The latest survey shows that the Bank’s market share amounts to 27%
in the field of interest derivatives. According to the TOP 2000 survey, Investkredit Bank AG is the
“quality leader among Austrian banks“. As in previous years, the Bank was also awarded first place
in the category “technical competence“, as well as second place in “decisiveness“ and “price“. It
is above all the technical competence, however, which forms a strong basis for exploiting the business
potentials of other financial instruments.
THE MARKET ENVIRONMENT. At the end of 2001, the world economy hit a 25-year low. Since
autumn 2000, industrial production has decreased by 7% in the United States. Investments into
plant and equipment have above all declined in the New Economy. Japan’s GDP dropped by 1% in
real figures in 2001 with the country’s economy being still in decline. In Europe, the economic situation
has also significantly worsened throughout the last quarters. With a rate of +1.5%, the European
Union’s growth was cut by more than half as compared with the previous year. Thus, for the first time
since the 1970s, the world’s three largest economies have been simultaneously hit by a severe economic
contraction. In order to ease the pressure on the economy, the US Federal Reserve Bank lowered
the federal funds rate in 11 steps from 6.5% to 1.75% and the discount rate from 6% to 1.25%. The
European Central Bank, however, wanted above all to keep prices stable and thus refrained from
significantly cutting the interest rates for a long time. It finally reduced them in four steps by a total
of 150 basis points. In the view of the coming EU enlargement, the currencies of the candidates
significantly appreciated, while interest rates slowly declined. By way of a liberalisation of the Hungarian
Foreign Exchange Law, the hedging of investments became possible for the first time. While at
THE BANK FOR CORPORATES
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