The amount of ING’s loans increased by 2% to 9.6 billion lei (EUR2.2 billion) in 2012 and the bank gained market share on certain segments on a very soft market, while deposits rose by 7% to RON11 billion.
Szczurek says the bank now prefers to consolidate its cash position to be able to increase lending in the future after having made a strategic choice to offer only leu loans and increase autonomy from the lines of credit of its parent bank in Amsterdam.
“We don’t want to increase deposits right when we need the cash, to pay high interests and attract short-term customers,” explains the ING CEO. Instead, the idea is to have a gradual process, persuade customers to save with the bank and thus provide stability of funding for the retail and the rest of the bank’s business. ING will need cash to increase lending to SME.
He says he thinks it is a good thing the bank has not been too aggressive on the segment so far, given the problems its rivals are facing. ING is now much better prepared and even though it is a challenge to accurately assess this client category, the strength of the bank’s services and network enable it to improve business on this segment, he added.
Szczurek stands by the decision to cease sale of mortgage loans in euros as of January 1, 2013 and promises that ING will offer a preferential exchange rate in case a customer buys a home whose owner asks a price in euros. This should help reduce the additional cost the customer who takes a loan in lei incurs when paying in euros for a home, as it often happens on the real estate market.
He believes that although some might choose to go to ING’s rivals, the strategy is good for both customers and for the bank’s health as a self-sufficient entity that can generate volume and growth in the number of customers without needing support from Amsterdam.
An expert in retail who is also familiar with the Polish model of lending in domestic currency, ING Romania’s chief executive says he is positive the bank can grow through loans in lei.
Retail generated 36% of the growth of the bank’s revenue in 2012 and ING will continue to gain customers by promoting the savings account at first.
It will also increase the speed of approval for consumer loans in lei based on a pre-scoring system and promises to approve loan applications from SME within 48 hours.
ING also wants to tap into the municipal loan business, having recently participated as a lead arranger in a RON100 million ten-year loan for the Bucharest VIth Sector City Hall.
(English version by Loredana Fratila-Cristescu)