Postbank has a 24 year history on the bulgarian market. In July, Postbank and Alpha Bank signed a Memorandum of Understanding for the acquisition of the Bulgarian branch of Alpha Bank. Following the completion of the acquisition, Postbank will become the fourth largest bank in Bulgaria in terms of loan and deposit portfolio.
What was the business rationale behind the acquisition of Alpha Bank Bulgaria and how will it affect Postbank’s positioning?
The deal, which we expect to be finalized by the end of 2015, will strengthen our position as one of the most stable financial institutions in the country with over 6.3 billion levs in assets. We expect to become the fourth largest bank in terms of loan and deposit portfolio, to expand our client base in the retail banking and corporate banking segments, to increase our market share and to continue to implement successfully the longterm development strategy approved by our international shareholders.
What are the highlights in your development strategy for 2016?
The focus of our growth strategy for 2016 is our ambition to be a bank of first choice for individual and corporate clients when they need financial solutions and products, to create sustainable benefits for our clients and be their strategic partners. Efforts to develop innovative products and individual solutions for each client will remain at the core of our bisiness.
The main contribution to our success so far has come from innovative solutions in various areas of our business. We introduced new products in home purchase loans, sought out ways to help customers in managing their family budget through programmes such as My Family, and last but not least, we created the first on the market innovation application for credit cards MyCard which further facilitated their use.
Having in mind the words of Jack Welch about the role of the leader, we at Postbank will be a mirror for our customers, helping everyone see in his reflection what he really needs. We will focus a big part of our investment efforts on innovation and employee training. We will continue to open new specialised centres for clients in different segments. We will also develop and offer our customers new bundled programmes for complex banking service which will allow freedom of choice as opposed to the standard banking products offered by our competitors.
Do you expect the consolidation in the Bulgarian banking sector to continue?
The main thing that the business and banks need is security and that is why the Bulgarian National Bank is supporting consolidation in the banking sector. In my opinion, the consolidation process will continue. Regulatory requirements, the need for investments and strong competition in a moderately growing market which limits profit margins, are among the consolidation drivers. Smaller banks lack the economies of scale and have no capacity to invest in the upgrade of their services and products, and this may push some banking institutions to merge. This would make the market more efficient and would bring down prices of services, which in turn would be good for the entire banking system.
Has the Bulgarian banking system recovered from the impact of Corpbank’s collapse, and more recently, the crisis in Greece?
The banks in Bulgaria managed to deal with the recent challenges and the level of capital adequacy and liquidity in the banking system is very high. Bulgarians retained their confidence in the banks. We all learned a lesson from Corpbank’s collapse, and it ultimately led to higher efficiency of each financial institution and the supervisory authorities.
Regarding the crisis in Greece, its impact on the Bulgarian business is much greater than the effect it has on the banking system. Our financial institutions are well-capitalised and have no exposure to Greek credit institutions. On the other hand, Greece is one of our main trade partners, many Greek companies have subsidiaries in Bulgaria and the Greek crisis had a negative impact on their results. The sooner the situation returns to normal, the better for everyone who wants to do business in Greece. Every crisis opens up new opportunities for people who can adapt quickly.