Erste Bank

Content
Structure of the banking system
Banks organizational network
History
Mission
Strategy
Basic differences in Serbia & Montenegro
Key Success Factors - Analysis tool
Activities
Shareholder structure
Management board
SWOT analysis
BCG matrix
Future market focus & plans
Competition
The intelligence pyramid
Concrete actions
Intelligence based strategy
Conclusion
Sources
Authors
Serbian banking system includes the central bank
(The National Bank Of Serbia), commercial
banks and other financial organizations (postal
savings banks, savings-credit organizations and
savings credit cooperatives). Banks in Serbia are
of general and universal nature; they conduct
their business independently, with a view to
generating profit in line with the principles of
solvency, profitability and maintained liquidity.
As of September 30, 2005, 41 banks with NBS operating
licenses were active in Serbia.
There was no merging of banks in the observed period
nor did any bank have its operating license revoked.
The number of banking sector organizational units totals
1,788, which implies an increase by 79 new organizational
units. Major contributors to the branching of banks
organizational network in Serbia were: EFG Eurobank
a.d. Belgrade, Credy banka a.d. Kragujevac with 6 units,
and Société Générale Yugoslav Bank a.d. Belgrade with 5
unites and Hypo-Alpe-Adria a.d.Beograd with 3 units.
N umber of Employees in Banking Sector
During the first nine months of 2005, the total number of
employees in commercial banks increased 8% towards 24920
employees.
During nine months of 2005, the greatest expansion of
organizational networks ( the opening of new business
units, branches, branch offices and counters ( total ) was
registered with the following banks.
Banks Organizational
N etworks
Profitability Indicators of Banking
Sector Operations
The survey of profitability indicators is given in the table below:
In the third quarter of 2005, negotiations on the sale of
Continental banka a.d. Novi Sad ( Nova Ljubljanska banka a.d.
Ljubljana, Slovenia ) and Novosadska banka a.d. Novi Sad (Erste
Banka AG Vien, Austria) were brought to a successful end, and
the sale was completed in the second half of July 2005.
Takeover of Other Banks
In 2005, Erste Bank successfully realized the purchase of
shares of Novosadska Banka a.d. Novi Sad on the capital
market
History
HYP0-ALPE-ADRIA
BANK
founded in 1896
initially concentrated on financing
public institutions and housing
construction
at that time known as Hypo kaernten
in 1982 became a universal bank
1988 took the first step on the road to
international expansion by opening a
leasing subsidiary in Udine
in 1991 became public limited
company
1992 Grazer Wechselseitige
Wersicherung joined the Province of
Carinthia as the second share holder
since then Hypo Alpe- Adria-Bank
Group serves more than 750.000
customers throughout 8 countries in
the Alpe-Adriatic region
ERSTE BANK
founded in 1819
1993 turning the bank business
division into a stock corporation
based in Austria and in central
Europe(Czseck,Slovak,
Hungary,Croatia,Slovenia,Serbia
and Romania)
provide banking investement,loans
and insurance services
in the next seven years from
Austrian Savings Bank has
developed into International Bank
Group with almost 40.000
employees in nine European
countries 13 millions of clients
mainly focused on consumers and
small to medium-size companies
Global presence is a goal which
Hypo Alpe Adria group is happy
to leave to the global players.
Knowing its customers personally
is the basis of their mutual trust.
Respecting differences, growing
together sharing success are the
cornerstones of partnerships with
customers, which are built on
proven banking systems. A
combination of clearly defined
shared goals and the cultural
diversity of eight countries
provides the engine for Hypo
Alpe-Adria s dynamic, international
growth- united HYPO
Improving and development of the
existing products, services and
creation of new ones, together with
flexibility in business and
expanding business network is the
mission of Erste bank.
Fundamental goals are best- quality
service on the market,proffesional
service focused on clients with
above-average financial capacity
and competitiveness in all banking
sectors. Moreover, being a market
leader in as many banking divisions
as possible is the mission number
one.
Hypo-Alpe-Adria Bank
Since 1993. the Bank has been pursuing its visionary strategy with
great success: to establish and develop a strong financial services
Group in the Alps to Adriatic region which combines the highly
developed Northern Italian, Germany and Austrian business cultures
with growth market opportunities in Slovenia, Croatia, Bosnia &
Herzegovina and Serbia & Montenegro. The preservation of
independence and regional identity is one of the cornerstones of the
Group's philosophy: this gives its customers and business partners the
certainty that there are transacting their business with a dynamic and
internationally minded bank which at the same time is at home in each
of the individual regions.
Strategy
Erste bank
Basic differences in Serbia &
Montenegro
Hypo Alpe Adria Bank has started from the very
beginning in this market, by establishing
completely new Hypo Bank system based on
experienced procedures of Hypo Alpe Adria
Group.
Erste Bank Group has purchased Novosadska
banka a.d. At the moment, it is in process of
transformation towards Erste Bank standards.
Hypo-Alpe Adria Bank has
established its reputation as a
strong and reliable business
partner.That is the result of
keeping promises to their
costumers and investors.
Preservation of independence and
regional identity is on of the
cornerstones of the Bank s
philosophy and Bank is thus
actively contributing to the
development of countries
economies.
The improved rating puts the bank
in a good position to raise capital
in international capital markets on
the best possible terms and thereby
enables it to provide its subsidiaries
in the various countries with loans
and favorable rates.
Erste Bank ranks among the top
three banks in terms of number of
clients in each market where it
operates
The strategy of restructuring and a
focus on under-penetrated retail
markets reduced staff members,
optimized the branch structure and
banking processes product
portfolio, fee structure, risk
management which has born fruit
in the form of improved market
share, cost control and profitability.
Erste Bank provide their customers
with additional security and trust as
founding stones of banking
business.
Analysis tool: Key Success Factor
Analysis
KSF`s
% Weighting Now
% Weighting 2010
Hypo
Erste
Hypo
Erste
Interest rates
15
20
15
15
Human recourses ( education )
10
5
15
10
Planning & Analysis skills
10
15
15
20
Marketing ( advertising )
20
15
10
20
Ability to act proactively
10
10
20
15
Collaterals
25
25
15
15
Quality control procedures
10
10
10
5
100
100
100
100
The Hypo-Alpe-Adria Bank
offers a wide range of
services:
Savings
Deposits of Legal Entities
Loans for Legal Entities
Loans for Private Entities
Accounts
International Operations
Safe Deposit Boxes
Internet Banking-Corporate
Clients
Internet Banking-Private
Clients
Card Business
Bonds
Domestic Payments
Erste Bank performs the
following services:
Banking
Investment
Loans and Insurance
Services
Special attention was given to
the development of
international e-banking.This
service is constantly being
expanded and e-banking
applications are regular
reviewed for suitability to
customer needs and
conformity to the latest
standards of security and
technology.
Hypo-Alpe-Adria
Erste bank
7%
Austria
Versicherungverei
n
6%
7%
5%
46%
Institutionals
investors
2%
DIE ERSTE
Osterreichische
Spar-Casse
Privatstiftung
Kartner Landesholding
Grazer Wechselseitige
Versicherung
Hypo-Alpe-Adria
Mitarbeiter Privatstiftung
49%
Employees
46%
32%
Saving banks
Private investors
Executive Bodies
Dr. Wolfgang
Kulterer
Mag. Günter
Striedinger
Thomas Morgl,
MBA
Josef Kircher
Chairman of the
Executive Board
Vice-Chairman
of the
Executive
Board
Member of the
Executive Board
Member of the
Executive
Board
STRENGHTS
E - Banking
Recognizable brand of the company
Quality services
Trustable customers
Wide range of products
PR activities
Highly educated employees
Good communication between employees
OPPORTUNITIES
Development of new technologies in
banking
Go public
WEAKNESSES
Small number of branches on the market
Relatively small number of employees
Strict procedures
Low efficient client-information IT base
THREATS
Competition
Entry of other strong foreign banks
STRENGHTS
Large number of branches
Part of ERSTE BANK GROUP
Customer's trust
E banking
Competitive interest
Permanent education of employees
Quality services
Non-strict procedures
OPPORTUNITIES
Development of new technologies in banking
To become one of the market leaders
WEAKNESSES
Large number of employees
Bad communication
THREATS
Competition
Entry of other strong foreign banks
Too large to manage
BCG matrix Hypo Alpe Adria Bank
and Erste Bank
H
I
5.
G
H
3.
4.
3.
2.
5.
1.
4.
L
1.
O
2.
6.
W
H IGH
LOW
Hypo Alpe Adria Bank
1.Corporate products
2.Transfer department and
treasure
3.Agriculture loans
4.Loans for entrepreneurs
5.Offer of visa business
cards
6.House loans
Erste Bank
1.House loans
2.Micros department
products
3.L/G and L/C
4.Factoring and forfeiting
5.Individual bank adviser
services
The creative teams of HypoAlpe-Adria Bank are always
searching for new forms of
customised services and
products to meet customer
needs.
Advantages:
All services at one place
Electronic banking operations
carried out within only a few
seconds
A possibility of contacting your
counselor at any time
Future market focus is
expanding business network
and market share, promoting
credit activities and increasing
the number of clients.
Erste bank has obliged to
provide, in the next 5 years,
EUR 15 mn of additional
resources for retail mortgage
loans and small and medium
size enterprise crediting
Until 2010 is planned the
increase of assets by eight times
Its share within banking sector
of Serbia will reach 10-12 %
from current 2 %
Organisation units and business
network extension are planned
from current 73 to 120
From 879 employees to 1200
Within last five yeras, many new International
Banks have been opened with sheer diversity of
products, individual offers and business
locations branches. As this was so, it has
become more and more difficult to save and
increase each Bank`s market share. Nowadays,
competition is strong and makes the greatest
threat of all banks. Therefore, each bank has its
own strategy to beat the competitor and gain
even wider range if costumers.
Hypo Alpe Adria Bank has decided to put on the first
place of its strengths excellent quality service and in
that way become recognizable! Nice, beautiyiful, polite
and skillful employees will make every single customer
HAPPY !
Erste Bank will approve the lowest interest rates on all
Bank products on the territory of Serbia and
Montenegro. Therefore, the Bank would provide even
wider range of middle class costumers in comparison
with the competition and achieve great profit.
CI
ACTION Implementation
STRATEGIC
IMPACT AND
DECISION
MAKING
INTELLIGENCE
KNOWLEDGE
INFORMATION
DATA
Communication, foresighting, making
concrete decisions and strategies.
Process( external, internal ) of transformation
from market, costumer, supply, political,
technical, economic environment towards
strategic actions ( future oriented )
Analysis, insights, procedures, internal seminars
Internal/external, structuring the facts,
statistics, market signs, newsletters, memos. .
Annuals, reports, quantitative figures,
number of clients . . .
Concrete actions of CI in the future
period - Hypo Alpe Adria Bank
1. Market
Within next three years save its market share and after IPO increase
it.
2. Product
Offer new products: wedding loans, overdraft , individual Bank
adviser services.
3. Technologies
Implement new Bank system PEXIM which would provide all kinds
of easy reachable information concerning all HYPO clients.
4. Environment
Open 15 new branches, especially in Middle Serbia and Montenegro.
5.Compettiors
Always be different in comparison with competition in since of
Excellent service towards customer in on the highest place of all
employees` duties list
Concrete actions of CI in the future
period - Erste Bank
1. Market
Increase the market share by regular weekly acquisitions SEARCH
FOR NEW CLIETS ( reports will be checked )
2. Product
In the next three years be the first to implement the next products in
its offer: FAKTORING and FOREFETING.
3. Technologies
Implementation of LOTUS NOTES BASE
4. Environment
High budget for marketing in the next period while ERSTE
BANK should become more recognizable brand on the territory of
Serbian and Montenegro .
5. Competitors
Take the step forward by offering the lowest interest rates in the
next three years.
HYPO ALPE ADRIA BANK
Excellent service towards customer is on the highest place of all
employees` duties list .
CHEERFUL AND SATISFIED CLIENT = BANK` S
HIGHEST PRIORITY
ERSTE BANK
The best interest rates for all our clients on the territory of Serbia
and Montenegro
THE CHEAPEST SERVICE = THE GREATEST SERVICE
Conclusion Hypo Alpe Adria Bank
Hypo Alpe Adria Bank is the Bank with
excellent image and it should be expected that
this Bank saves the forth place on the list of best
banks in Serbia. During these several years it has
managed to gain pretty recognizable level of
profit, market share and customers trust.
Therefore, if this Bank establishes even more
branches on the Serbian market, with the same
quality services, all the aims would be certainly
fulfilled!!!
Since this Bank has been for pretty short period of
time in the Serbian market, it must be admitted
that the results are excellent so far. Still, this Bank
is in the process of transformation from
Novosadska Banka a.d. towards Erste Bank
standards and therefore has lot to do . The main
goal for the next period is complete bank recovery
in sense of getting used to new business
procedures, standards and management.
Erste bank publications
Hypo publications
www.erstebank.com
www.hypo-alpe-adria.com
www.nbs.co.yu
www.finnet.co.yu
www.thebanker.com
www.priv.yu
www.srbija.sr.gov.yu
Professor Rodenberg`s handouts