Bulgaria

With a market share of 10.3%, HVB Bank Biochim (together with the recently acquired Hebros Bank) is the third largest bank in Bulgaria. In 2004 the bank was given a new name and a new logo – both were effectively introduced in a marketing campaign. After the successful restructuring and merger of the two predecessor banks, HVB Bulgaria and Commercial Bank Biochim, the newly developed sales strategy was applied to the bank’s entire sales network.

In 2004, the number of our customers served by a staff of over 1,500 in 131 branches increased to more than 420,000. The bank optimised the branch network by closing several very small offices which offered a limited number of products. Customers are now offered the entire product range in the larger branches.

As the result of various marketing campaigns and the expansion of sales activities, loans and deposits in corporate and retail banking rose significantly.

Net income before taxes was € 18.4 m, 61% above the figure for 2003. As a result of higher business volume, net interest income rose by 41% to € 37.3 m and net fee and commission income by 23% to € 14.1 m. The return on equity was 23.5% (third highest of all the CEE subsidiaries) and the cost/income ratio 60%.

Business structure and development
In corporate customer business the new service approach focusing on business expansion was implemented in the four newly established regional corporate centres.

The introduction of the co-branded MetroPlus Card has enabled HVB Bank Biochim to meet specific needs of business customers. The Metro wholesale markets operate exclusively on a cash and carry basis but MetroPlus Card holders can buy on credit. The card is linked to a current account at HVB Bank Biochim and provides a revolving overdraft facility.

In addition to the implementation of the new sales strategy for retail customers, the bank’s competitive strength was improved by the launch of new products and the setting up of mobile sales units. A savings drive carried out in 2004 brought additional deposit growth. In lending business the focus was on mortgage loans.

After receipt of approval from the Bulgarian authorities six mutual funds of Capital Invest, Bank Austria Creditanstalt’s mutual fund subsidiary, were introduced on the Bulgarian market. These mutual funds offer Bulgarian customers the opportunity to invest in international equity and bond funds.