[ S U R V E Y
|
A G E N T
UniCredit
UniCredit Bulbank records a performance consistent with that
of a year ago. This is impressive, given how much the ques-
tionnaire has changed and expanded. The bank fares less well
against the (much distorted) local and global benchmarks, but
the average scores conceal how well the bank is doing in a series
of service areas that matter a great deal to foreign investors:
efficient on-boarding and account opening, timely settlement,
secure safekeeping of cash and securities, reliable asset servic-
ing, savings on credit and astute management of infrastructural
and risk issues. Amid considerable volatility in the scoring even
within particular services, the area most obviously in need of
improvement is a predictable one: pricing.
B A N K S
I N
F R O N T I E R
M A R K E T S ]
largest number of responses in this crowded market, and the
overall average score is much the same as it was in 2018. Re-
spondents have some highly specific reservations in asset safety,
asset servicing and relationship management which depress an
otherwise excellent performance in all three fields. There are
no complaints about the client service, and respondents feel the
prices are justified, fair and well-managed.
OTP Bank
Banks in Croatia are mostly owned by foreign parents. The pub-
licly listed OTP, which purchased the former Splitska banka from
Société Générale in 2017, is the exception, though it has a number
of foreign minority shareholders. Though the merged banks do
not advertise a custodial capability as widely as Splitska did when
it was owned by a French bank, it did still attract some responses
to this survey. Unfortunately, there are not enough of them to
make sound judgments about their quality. In fact, the observa-
tion of one of them (“Our link with this provider did not last long
enough to give a relevant evaluation”) explains only the volatility
of the scoring between the responses that were received. It does
not yield any reliable information about the quality of the services.
Raiffeisen Bank International
The Austrian bank is a newcomer to the survey here, though it
opened for business in Croatia 25 years ago. It did not attract
enough responses to assess its services this year but the com-
mitment of Raiffeisen to the region is now allied to a respectable
stock exchange in an EU member-state.
CROATIA
Stocks on the Zagreb exchange, which now runs on the Xetra
trading platform, have traded in a fairly narrow band over the
last two years but the performance of the MSCI Croatia index
suggests investors have made money here over the years. The
exchange is also supported by a functioning central securities
depository, the Central Depository and Clearing Company
(SKDD), which provides further assurance to investors.
UniCredit
UniCredit has long claimed to be the market leader here –
Zagreba Č ka banka has been part of the group since 2002, more
than a decade before Croatia joined the European Union (EU),
and it has certainly attracted more responses than any other
provider in Zagreb. The average scores, however, are indifferent.
The most conspicuous weakness -pricing – is a familiar one.
UniCredit clients share the survey-wide lack of confidence in
the value they receive for cash and foreign exchange. Clients are
also disappointed by the quality and pro-activity of the staff, and
by the depth and intensity of the relationship. However, they
do trust the bank to keep their cash and securities safe, and to
husband their liquidity carefully.
PBZ (Intesa Sanpaolo)
The Italian bank has controlled Privredna banka Zagreb (PBZ)
since its privatisation in 2002, though it did not acquire com-
plete control until as recently as 2015. It has attracted the second
Erste Group Bank
Erste Bank has had a substantial presence here since it acquired
Rijecka banka in 2002 and merged it a year later into its long-
standing local savings bank subsidiary, Erste & Steiermärkische
banka (ESB). The net result is a sizeable retail branch network
and a head office in Zagreb which can provide a custody ser-
vice for investors active in Croatian securities. Though Erste
received too few responses to be assessed properly, the evidence
indicates that the bank is doing a more than satisfactory job
across all service areas, with the exception of cash management
and foreign exchange, where the scores indicate an appetite for
greater flexibility and more transparency. By contrast, relation-
ship management and client service are standouts alongside
account management and asset safety.
CYPRUS
Stock prices on the Cyprus Stock Exchange have flat-lined for the
last five years. The entire banking industry in Cyprus has oper-
ated for years under the weight of slow-burning efforts to drain
balance sheets of non-performing loans. Cyprus exited its Troi-
ka-imposed “economic adjustment programme” as long as three
years ago, but the Co-operative Bank crisis almost pre-empted
re-entry a year ago and was averted only by imposing further
heavy costs on taxpayers already staggering under the burden
of massive public debts used to fund State intervention in the
banking system. Cypriot government debt has only just regained
investment grade status. This makes it hard for the economy to
grow and the stock market to perform, but growth is reviving,
especially in the important construction and tourism sectors.
Spring 2019
globalcustodian.com
61