Thursday , October 21 2021

Politika Online – Union of the banking market of Serbia


The wave of takeover that has spilled Serbia's banking market on the one hand is quite predictable, and on the other hand, completely unexpected.

It is expected that experts argue that 29 banks are too much for the country whose gross domestic product last year was less than 37 billion euros. But it is not expected that in the past foreign banks have already been bought by existing domestic banks, and more recently foreign-owned banks are buying local businessmen.

The first move was canceled by Myodraj Kostik, who in the meantime became the 100-year-old owner of Ike Bank to take control of Alpha Bank.

Last year, AIK Bank was the first in Serbia for a net profit of 118 million euros, the fourth for half a billion euros sixth capital for a total of approved loans of almost 1.8 billion euros, reported the agency Beta.

New players in this market are Andrei Jovanovic and Bob Milovanovic, who first acquired the Serbian branch of Nova Cardita Banka Maribor, changed their name to a direct bank, and then bought Piraeus and the Bank of Finland.

Before joining Piraeus, at the end of 2017, the bank was tenth with a profit of 16 million euros, and in 19 th place after participating in the total assets of 0.8% (the share of Piraeus Bank was 1.5%) and capital from 33 million euros, while the capital of Piraeus Bank is three times higher, 108 million euros.

Many of them no longer remember that more than 80 banks operated in Serbia two decades ago, almost all with local capital. By 2004, their number had fallen to 47, and this trend continued, but in the meantime, new "players" came to the market, such as Bank of Tea or Mira Bank of the United Arab Emirates.

In professional circles, there is almost agreement that the tightening of the banking market in Serbia is still to come, because banks with a market share of less than two percent can hardly survive any difficult game.

To date, there are 14 banks with a market share of less than 1.5%. All approved only 7.5% of all loans, while the six largest banks, Intesa, Komercijalna banka, Unnikredit, Societe Generale, Raiffeisen and AIK Banka were eight times higher – 62.2%.

Minister of Finance Sinisa Mali has already announced that the state plans to sell its stake in the bank Jubmes until the end of the year, next year in Komercijalna, and the strategy is to be ready for the Serbian bank. In addition, for months, the public has speculated who can buy the Societe Generale Bank because this French group has already withdrawn from the Croatian market.

In favor of this thesis, there is also a low level of concentration in the Serbian market. In Croatia, the four largest banks make up almost 70% of total assets, and in Serbia the four largest banks approved about 47% of all loans. Therefore, Ivan Nikolik, a member of the Board of Governors of the National Bank of Serbia, believes that the unification is not only predictable but also desirable. "This is a positive process, since it will increase performance and strengthen competition between banks, and it will bring benefits to customers as they will be cheaper loans," said Nikolik, who recently told BETA that he did not see the problem in that banks buy domestic investors. Previously, says a board member of NBS, "Experience has shown that foreign owners do not always succeed."

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