Slovakia

HVB Bank Slovakia is the fifth largest bank in the country and has a market share of 5.5%. In 2004 it further expanded its network: branches were opened in Luãenec, Pie‰Èany and Nové Zámky. The bank thus pressed ahead and increased the number of branches from 12 in 2001 to 27 at the end of 2004 – another branch will be opened in 2005. A staff of 437 serve more than 28,000 customers throughout the country, an increase of close to 20% compared with 2003.

In Slovakia the bank achieved net income before taxes of € 20.1 m, an increase of 8% over 2003. As a result of a higher volume (+8%) of loans to corporates and private customers as well as a rise in deposits (+26%), net interest income grew by 7%. Due to the additional branches opened, general administrative expenses were higher but at 51% the cost/income ratio remained moderate.

For the second year in succession our subsidiary in Slovakia won the prestigious “Bank of the Year” award, a prize awarded annually by TREND, a major Slovak economic magazine. This achievement underlines the bank’s position in the Slovak banking sector.

Business structure and development
The corporate business segment reacted to the challenge presented by European Union enlargement by introducing “HVB Euro Expert”, a loan and advisory programme targeted at medium to long-term investment finance based on EU credit lines. Two versions are offered and enabled the bank to increase its share of the corporate loan market.

Factoring is one of the most dynamically growing financial service segments in Slovakia. For this reason a factoring subsidiary, HVB Factoring s.r.o., was established. 80% is owned by HVB Bank Slovakia and 20% by Vienna-based FactorBank.

With the HVB securities savings plan our subsidiary in Slovakia offered a new product to private and business customers. The customer selects equity or bond funds from the large portfolio of investment funds offered by the investment management companies Capital Invest and Activest and determines the monthly investment amount.

The bank meets growing needs to finance residential property: the range of mortgage products increases steadily, over 7 new products were introduced for specific customer groups in 2004 alone. These products are promoted through TV and cinema commercials and advertisements. We are convinced that we will be able to further strengthen our position on the Slovak market as a mortgage loan specialist and thus set ourselves apart from our competitors.

One of HVB Bank Slovakia’s objectives is to be among the leading providers of credit cards. The co-branded product Max Club was introduced with Slovak Telecom as the branding partner. This cooperation opens up important cross-selling opportunities.

Competition for customers is fierce on the relatively small, saturated Slovak market. To guarantee our success we decided to be innovative and set up an integrated network of traditional bank branches, mobile sales teams (external partners) and financial advisory centres. The latter are sales units (no cash transactions) set up throughout the country in town centres and pedestrian zones, especially in small towns. To establish mobile sales units, HVB Bank Slovakia enters into cooperation agreements with established external partners such as independent insurance brokers. Since its inception, this cooperation network has grown to include ten companies.