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24.09.2009

Change of CEOs at Bank Austria:
1997–2009: Milestones during Erich Hampel's tenure as CEO

Under the aegis of Erich Hampel, Bank Austria successfully turned its vision of becoming an Austrian bank with responsibility for 19 countries in CEE into a reality and went from a "national champion" to a leading player in the "Champions League" of European banking.

Erich Hampel led Bank Austria through several major changes at the international level as well as several internal restructuring processes. When he took over the helm of the bank in 1997, Austria had only been a member of the European Union for two years, and the expansion of domestic financial institutions into Central and Eastern Europe was just getting started. In addition, there was a considerable need for modernisation in the banking sector at the end of the 1990s, with the introduction of IAS/IFRS accounting standards, preparations for the common European currency and the adoption of new capital requirement provisions according to Basel II.

Rise from "national champion" to the "Champions League" of European banking
After the merger with Creditanstalt in 1997, Bank Austria had around 19,000 employees. In the meantime, this figure has tripled and now totals around 62,000 employees, approximately 80 per cent of whom work in the CEE business segment. Especially over the last five years, as a sub-holding of UniCredit Group for Central and Eastern Europe, Bank Austria has significantly expanded its presence in the region. While Bank Austria had around 680 branches in ten countries in 1997, by 2004 the total had already increased to 1,300 branches in 15 countries, and today the bank has 3,183 branches in 19 countries. In the same period of time, the number of customers increased fifteen-fold to 24 million. The bank’s equity capital has more than tripled, rising from just under EUR 4 billion in 1997 to around EUR 7 billion in 2004 and EUR 14 million at last measure. Even in the crisis year of 2008, profits were three times higher than in 1997.
Strengthening the bank’s position as the undisputed number one in Austria
Bank Austria sees itself as the leading European bank in Austria. Although its market responsibility has steadily grown with each merger and through many acquisitions, the bank still has strong roots in its home country. Its market share ranges from 18 per cent in the retail banking segment to 88 per cent in the corporates segment, making Bank Austria the largest individual bank in Austria.

Successful implementation of three major mergers
During Erich Hampel’s tenure, he helped to successfully orchestrate and implement three major corporate mergers: between Bank Austria and Creditanstalt in 1997, between Bank Austria and HVB in 2000 and between HVB and UniCredit in 2004. Each merger expanded the bank’s scale and pushed Bank Austria to new dimensions, particularly in Central and Eastern Europe. Thus, Bank Austria was a pioneer in the expansion into CEE and in the formation of the first European banking group as well as a driving force behind the consolidation of the Austrian banking sector.

Overcoming the most severe financial crisis of all time thanks to a sustainable business model
Following the collapse of Lehman Brothers in September 2008, the global financial market crisis clearly intensified once again. Many governments adopted stabilisation packages for banks and companies in order to protect the real economy as much as possible and prevent a system collapse. While the American separate banking system characterised by pure investment banks appears to be a thing of the past, the European universal banks have weathered the crisis far better. As a strong member of UniCredit Group, Bank Austria achieved a balance sheet total of EUR 222.2 billion and net profits of EUR 1.1 billion in 2008. The bank’s business model, which is broadly diversified both geographically and in terms of product and customer groups, thus proved itself to be extremely resilient to the crisis. The clear focus of this business model is the customer. Bank Austria remains the largest and most profitable bank in Austria.

Erich Hampel, departing CEO of Bank Austria:
"I am pleased that Bank Austria is completely healthy and stable despite the financial market crisis and that I am able to hand over a well managed ship, especially amid these turbulent conditions. Particularly during the financial market crisis, the bank’s integration into UniCredit Group and its broadly diversified, divisional business model proved to be important stabilising factors. I am handing over the task of further developing this business model and dynamically adapting it to fit new demands as they arise to my long-time colleague Willi Cernko. I wish him great success in this endeavour and intend to do everything I can to support him in my new function on the Supervisory Board."

"A journalist once described me in a profile as a 'goldfish in a pool of sharks'. Although it is scientifically questionable, I can definitely live with this analogy. Because my swarm – the Bank Austria Group – has grown and many sharks have been forced to go against their nature and become vegetarians."

Enquiries: Bank Austria Press Office Austria
 Martin Halama, Tel. +43 (0)  50505 - 52371
 E-mail: martin.halama@unicreditgroup.at

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