“I have found here a very balanced atmosphere, a European country, a place for business,” stated the Italian banker who has run UniCredit Group for three years and a half.
Ghizzoni, 58, came to Bucharest last week on a 36-hour visit, the first one since he took over the reins of UniCredit Group in September 30, 2010. He met managers of the Romanian team and a series of major clients. He also had a meeting with Romanian premier Victor Ponta.
Romania is not very often visited by the heads of major international banks, primarily because of these only Societe Generale, ING and UniCredit have significant operations in Romania. No relevant German or Spanish bank operates in Romania.
Among Europe’s banking system “heavyweights”, Ralph Hamers, ING Group CEO, is likely to come to Romania this year as the group celebrates 20 years of Romanian operations. The Dutch banker also ran ING Bank Romania in the early 2000s.
“Romania is a significant market for us. And this is not empty rhetoric. We have a positive vision of the future, the more so as the domestic bank proved it can react well during difficult times. It is well placed for a new cycle of economic growth,” said Federico Ghizzoni.
He shows UniCredit has constantly cemented its position since it arrived in Romania in 2001, while the current bank was born seven years ago through the merger of UniCredit and HVB Tiriac. “Several years ago we ranked 6-7, and in 2013 we climbed to the 4th position. And including the other group assets, including leasing operations, we are the third player on the market”.
What does he expect from UniCredit Tiriac Bank in the next five years?
“To follow the direction of the past five years and find new growth opportunities, primarily organic growth.” However, the group will also look at deals such as the one signed last year with RBS, when the Italian group took over the British bank’s retail portfolio in Romania. “Romania is an important market for UniCredit, we have a clean, healthy bank here and all that matters in fact is to show consistency.”
The Italians are not “desperate” to become number 1 in Romania. Ghizzoni chooses not to anticipate whether the name of Tiriac will still be included in the name of the domestic bank, that is whether Romanian businessman Ion Tiriac, who controls 45% of stock, will exercise his option of selling his stake to the Italians. Market sources state the deal is likely to take place next year.
“We have a very good, strategic and longtime relationship with Mr. Tiriac, whom we see not only as a partner, but also as a friend. Hence, he should just call us if he decides to exit at a certain moment”. UniCredit has a similar partnership in Turkey.
As regards the group of Romanian individuals still captive with a 4% stake, Ghizonni reckons no exit solution has been found so far, but hopes the problem will be solved finally.
Tiriac has not cashed in any dividend since the bank became operational. “We have not taken out any money of the bank as dividends, the entire profit has been reinvested. Mr. Tiriac has not received any dividends, but the value of the bank has meanwhile increased, and for strategic investors such as us and Mr. Tiriac, value creation is what matters the most.”
UniCredit head reaffirms the group does not need any capital increase, unlike many other European banks that are already seeking new capital on the market. Ghizonni’s bank still needs to pass the AQR test (asset quality review) of the European Central Bank, which should indicate whether things are really ok at Europe’s major banks. The Italian banker says he has no fears about the results.
“I am not worrying as through the provisioning move of 4Q we did even more than the ruling authorities would have expected of us. This is why we significantly raised the coverage level in Romania as well. We are confident we did enough at this chapter”.
In 2013, UniCredit Tiriac Bank’s provision expenses doubled against 2012, to around RON683 million.
(English version by Catalina Apostoiu)