central and eastern europe
IB for CEEC
NewS
NewS
International flavour
Niche position
More support
6 What'sNewS Issue 5'May 1998
Our Hungarian operation is already building a reputation in IB; Warsaw is in the
process of introducing investment banking products to its Polish customer base.
But which products are needed in these increasingly sophisticated markets and
which would be appropriate in, say, Moscow and Kiev?
The response to this very
clear and specific need is
a dedicated team of
relationship managers,
product managers and
corporate finance specialists
who meet regularly to share
knowhow. 'The coordination
committee for investment
banking and corporate
finance is not a decision-
making or policy-making
group,' says Jaap Kool of
NDS. 'As the name suggests,
we are very much a
coordinating team. In the
past, lots of people were
taking intitiatives but not
communicating them.
Exchanging ideas works in
many ways - top down,
bottom up, and so on. Top
down is more common, but
in the coordination
committee we're working
Rory Byrne
with people from the
front line.'
The committee meets
monthly and participation
rates are high. At this tenth
gathering, London-based
Rory Byrne of the global
forex team represented
Michele di Stefano and
commented that 'this is really
a way to get information you
need directly from the
source. Interdisciplinary
gatherings are always useful,
but I'm especially happy to
be here because like many of
my investment banking
colleagues, I'm very new to
the organization. This gives
me a chance to build my
network, a chance the new
IB people really need.
Knowing people facilitates
developing our business. It
has been really useful.'
the law changed and that has changed
our status - it set us back. But what is
more sensitive perhaps is the regulation
on banking equity - only 12 percent of
the total can be foreign. We have to
make sure we are in there before this
window of opportunity closes. As
capitalization requirements are being
increased gradually, we have to keep
topping up our own so that we are not
caught without the required funding
when our turn comes.'
With EMU right on track and 11 countries
slated for first-wave implementation, the
candidate members of the EU are raising the
euro stakes in their own economies. Our people
in Warsaw are at the cutting edge of customer
information on the single currency - we will be
hosting a dedicated EMU conference on June 3
in the Polish capitaI and What's NewS will be
reporting the event in our next issue.
Both Moscow and Kiev are in a
position where lack of licences mean
they are limited in scope of activity.
However, both are already working with
the network to support clients. 'Part of
our mission,' says Evangelisti, 'is to
bring a Western-style approach to
quality banking with a Ukrainian face.
That will establish us in our domestic
market and also facilitate the support
we can provide to the network's
customers interested in doing business in
this country. That's the ambition - all
we need is the paperwork.' The
international flavour is a selling point
used whenever possible by the
Hungarian team. 'The fact we're seen as
an international bank is very important
here,' confirms Simonyi.
I n this country, all banks offer the
I whole product range,' he says,
'everything from cash management,
which here means picking up cash from
locations in the countryside, to ATMs,
credit cards, foreign payments, financial
advice and consultancy. There is no way
we can do that. So you have to focus
on what distinguishes you in the
market. We are a niche player. Niche
does not mean small focus and small
product range. In this case, it can mean
our ability to provide investment
banking products from our F&A
knowledge base. The competition in
Hungary has a huge cultural difference
between IB and their commercial
operations. We can, and do, take
advantage of that. In addition, we are
the only bank in Hungary which has a
F&A research unit. That is known in
the sector and it's a huge advantage.'
We need every advantage we can get.
We are late arrivals in the region
and we're spread thinly on the ground.
Competitors such as Austria's RZB
already have a dense network of offices
and its goal is to generate 70 percent of
The global media and telecommunications
group has appointed a relationship manager
with dedicated responsibility for Central and
Eastern Europe. Roger Jansen began work with
theGMTGon 1 April 1998.
total turnover in the region by the year
2000. 'This is just one of the banks
which was in here early and those
banks are huge now,' says Oet Bakker;
Tamas Simonyi notes that Citibank
entered the Hungarian market in 1980!
'If you look at
Poland, then in
spite of the
competition,
there is still
enough
opportunity,
especially for a
F&A bank,'
Bakker
continues.
'However, the
fabulous
margins that
could be made
when the country was more volatile are
falling with horrifying speed - last year
they were still high, this year they are
reasonable. If we are to achieve our
full potential in these very F&A
oriented countries, we need all the help
we can get - from the network and
from head office.'
Oet Bakker
