Whereas it had 245 branches at the end of 2011, UniCredit had only 208 after the first half. It also had 2,852 employees at the end of June, 130 fewer than six months before.
UniCredit’s network was at its lowest on June 30, 2012 since the start of the crisis in 2008, the last boom year for the market, when it had opened 100 branches for a total of 242 and almost 3,300 employees.
Banking sources say Ion Tiriac, who owns about 45%, has been advocating an expansion of the territorial network and an increase in the retail business volume over the last few years, but the Italian co-owner said the market was not favorable for that. Tiriac’s bank contributed had a significant retail portfolio at the time of its merger with HVB Bank in 2005.
The successive mergers with HVB and then UniCredit, both of which banks that focused on the corporate business, resulted in UniCredit Tiriac Bank being a bank where corporate customers account for most of the business, too.
UniCredit’s mortgage loan portfolio dropped 15% in the first half compared with the end of 2011 to 3.8 billion lei (EUR0.83 billion).
On the other hand, the volume of personal loans and the amount drawn from credit cards rose 11% to RON592 million.
The bank’s chief executive Rasvan Radu says that UniCredit sold loan portfolios in the first half, especially loans taken out by individual customers.
“It’s about old and very old retail loans for which our chance of recouping them had become very slim over time. We are not specialized in this business.”
UniCredit took the market by surprise at the end of 2010 when it announced a bold expansion plan by up to 300 branches, even though the exit from crisis was nowhere in sight only to say such an action would be suicidal under the circumstances a year later.
The plan started being applied tentatively in 2011 and was shelved in 2012 when almost 40 branches were closed, that is 15% of the network in operation at the end of 2011.
The boss that had commenced the expansion, Emanuele Butta left the bank only a bit more than a year after his appointment and his replacement, Maurizio Volcich has not been approved by the central bank for his position as head of retail yet.
The bank posted RON75 million in net profit in the first half, down almost 20% on the year-ago period.
(English version by Loredana Fratila-Cristescu)