Garanti Bank Romania is one of the most dynamic banks in the banking market in our country. Remember please the main stages of the expansion of Garanti Bank in Romania.
Garanti Bank has always been on the rise, from the day it started its operations in Romania, in 1998. The bank managed to prosper during the economic crisis years, by keeping a well-balanced portfolio and developing all its business lines – Retail, SME and Corporate – in a level-headed way.
The expansion was possible due to our ability of adapting to the market conditions, year on year. We focused on growing, on expanding and on investing in innovation from the beginning and now we are currently one of the top banks in the system.
We have extended our national Branch network to 84 branches, at the moment and we have over 300 smart ATMs. Our plans are to continue our organic growth in the following years, as well.
With what result will Garanti Bank end this year? Does your balance fall within parameters set by Garanti Bank?
As I previously mentioned, Garanti Bank has a long-term strategy of growing in a balanced way, in all its segments (Retail, SME and Corporate) and 2015 is in line with this strategy.
Our overall loan volume stock in all segments reached, in the first nine months, RON 6.3 billion, representing a 23% increase year-on-year. We also registered a 25.3% growth in deposit volumes as compared to the same period in 2014. Moreover, this year, the International Rating agency Fitch Ratings has upgraded our long-term IDR to ‘BBB-‘, from ‘BB+’ (Outlook stable).
Could you highlight some strategic coordinates of Garanti Bank in 2016?
Garanti Bank follows every year the most important strategic objective of growing its portfolio in a healthy and sustainable way. As such, in 2016 we will continue to develop all our business lines, putting great emphasis on innovation. We have entered in a digital era, so our efforts will also be targeted towards adapting our product and services to the new demands on the market.
Also, our activity will focus on keeping a top position in the banking system, as well as enlarging our number of customers, for which we can be trustworthy financial partners.
What is your view on the evolution of the Romanian banking sector in 2016?
This year we have already seen important acquisitions, as well as exists from the market. The banking sector is reshaping itself, which is an important step for its evolution. In 2016 we will definitely see more of this type of changes.
The banking sector will also focus more on the digitalisation process, meaning improving and extending their services, considering the fact that online and mobile transactions keep on growing.
Recently, you published a survey that estimates that lending will improve in the next years. What will be the impact of the new tax code on the dynamics of Romanian economy?
According to our most recent Macroeconomic Report, the banking loans dynamics have exited the negative territory this year, in August. As such, new loans have increased by 30% annually and our experts estimate that this ascending trend will continue next year.
Regarding the new tax code, there are some remarks to be made on how it can impact lending and overall the dynamic of the Romanian economy.
The amount of money left in the private sector through the implemented tax cuts (both on food and general VAT cut) is quite sizable, around 2.2% of GDP annually. Part of the money is invested or consumed, increasing domestic demand, therefore, the GDP as well. As such, we estimated this impact to be around 0.9 – 1 additional percentage point growth in GDP.
This, however, represents a short-term development, since only investments can sustain the longer term development. After several years of financial recession, there is a need of both private and public investments to boost the production capacity and to attract further capital. A consumption-driven growth can be maintained just temporary.