Corporate & Investment Banking 2011/12:
Shaky times require strategic financial solutions
- Bank Austria's corporate banking business records increase of 1.5 percent in credits to EUR 39.5 billion and of 5 percent in deposits to EUR 18.2 billion
- Leading position on capital market expanded: Bank Austria supported transactions on the debt capital market amounting to EUR 2.43 billion – corresponding to 50 percent of the total issue volume on the Austrian market
- Eight out of ten companies with annual revenues of more than EUR 50 million have banking connection with Bank Austria, and for six out of ten businesses we are their main bank
- Given the excellent liquidity and equity base with a Core Tier 1 capital ratio of 10.42 percent it is still possible to adopt a strong approach to credit supply in the economy
- Strong focus on core clients and core markets to make even better use of the Group network
- Development of strategic financial advisory by implementing two initiatives, "Senior Banker" and "Capital Structure Advisory", aimed at designing tailored and sustainable financing strategies
With economic growth of approximately 3.3 percent the Austrian economy put in a good performance despite a setback in the second half of the year and growing uncertainty towards the end of 2011. The corporate banking business of Bank Austria, serving companies with annual revenues of more than EUR 50 million, withstood the uncertainties of the last six months and once again proved its reliability: "We are very satisfied with the progress made. In spite of the economic gloom we managed to grow our lending to corporate clients by 1.5 percent to a total of EUR 39.5 billion, while in terms of deposits we registered growth of 5 percent compared to the previous year. Having supported the issue of eight bonds in total issued by leading Austrian companies as well as all major equity market transactions, we have established ourselves as the preferred partner on the capital market", said Dieter Hengl, Director of Corporate & Investment Banking at Bank Austria, taking stock of 2011. Corporate banking underlining its leading market role in the field of "export financing" was particularly impressive, while "commercial real estate financing" also managed to reproduce its record performance from 2010.
Eight out of ten companies with annual revenues of more than EUR 50 million have some form of banking connection with Bank Austria, while we are the main bank for six out of ten businesses. "Our clients value our high advisory standards and quality of service. The trust our clients place in us as a reliable partner, even in difficult times, has made us the number one in the corporate banking business. Reliability and security are attributes that companies value a great deal, especially when economic times are hard – and that is exactly what we offer our clients", added Dieter Hengl.
New year, new challenges – strategic solutions required
The year 2012 will undoubtedly present its own challenges. Yet as the best-capitalised large bank in the country with a Core Tier 1 ratio of 10.42 percent, Bank Austria is well positioned to cope. "Thanks to our solid equity base we can continue to adopt a firm approach in supplying Austrian companies with credits. We also want to win new clients in 2012, which is why we have set ourselves the goal of achieving growth of two to three percent", said Hengl, explaining the growth objectives for corporate banking.
The corporate banking business at Bank Austria will focus even more strongly on core clients and its core markets in 2012, and on making better use of the UniCredit international network. Expanding strategic financial advisory services to corporate clients will be particularly important in the coming year, revealed Dieter Hengl: "Integrated corporate planning is becoming increasingly difficult as a result of the general economic climate. This is why we will be focusing on expanding our strategic financial advisory services, especially in the form of two initiatives recently launched: "Senior Banker" and "Capital Structure Advisory". This will enable us to address individual client needs more closely than before to identify customised solutions."
The "Senior Banker" will support top corporate clients together with the Group relationship manager, rounding off our service with professional know-how in the investment field. With the "Capital Structure Advisory" initiative the Bank develops tailored and sustainable solutions together with clients based on the current financial situation and taking full account of individual company strategies. In this context we aim to align financing structures to individual client requirements. "I am convinced that with this proactive and integrated service approach we can continue to support our corporate clients in all phases of their businesses", said Hengl, talking about the initiatives to be implemented this year.
Overview of highlights in individual business areas in 2011
Bank Austria managed to reinforce its position of "preferred partner" for corporate clients on the credit and capital market. Although the market was shaken by the volatile economic climate in the second half of 2011, Bank Austria supported the issue of eight corporate bonds last year along with capital increases at OMV, Lenzing, Immofinanz and AMAG. Totalling EUR 2.43 billion, the sum of debt capital transactions accompanied by Bank Austria almost doubled in comparison to 2010. "I am very proud that as joint lead manager we supported leading Austrian companies last year such as OMV, Egger, Alpine, Strabag and Wienerberger in issuing their bonds. This shows that companies acknowledge our expertise on the capital market. This year we will be doing likewise with some other companies with their activities on the capital market. The current climate should be a boost for bond issues", said Hengl, giving some insight into expectations for the current year.
Number one with export credits covered by OeKB
Last year Bank Austria managed to prove its expertise with export financing once again. Just as in 2010 the Bank managed to maintain its leading market position in export credits covered by OeKB. Almost one in every two export credits covered by OeKB is handled by Bank Austria. "The broad spread of import markets that we finance only serves to confirm our strong position in the field of export finance. We accompany our corporate clients everywhere – from our core markets in Central and Eastern Europe through the growth markets in Asia to the markets of the future in Africa. And we are extremely optimistic looking forward to this year as well, especially given the promising list of projects planned by various exporters in different markets. During these times of financial market turmoil we are seeing a revival of "export finance", i.e. tied finance credits and factoring covered by OeKB", said Dieter Hengl, talking about the "export financing" business.
Real estate: stable at a high level, financing top-quality projects
Once again the field of "commercial real estate financing" is proving to be a stable pillar for the corporate client business. The "Real Estate" division more than doubled its new credit volumes from 2009 to 2010, but still managed to maintain this extremely positive trend at EUR 2.2 billion in 2011. Financing volumes in Central and Eastern Europe (CEE) were increased by another 10 percent on 2010 to EUR 740 million. One of the main real estate projects last year was refinancing the residential property portfolio of CITIM Holding GmbH, which includes 53 apartment complexes amounting to EUR 110 million. Bank Austria also undertook the financing of a key project of SIGNA Holding, which is constructing the Tuchlauben luxury shopping centre in the centre of Vienna.
Cross-border financing for Eastern Europe
Equipped with the new "Umbrella Facility – one credit, available for ten countries", Bank Austria can now support businesses with their activities in the emerging economies of CEE countries. The key benefit of this facility is the centrally coordinated provision of credits in a fast and flexible manner for companies that require a cross-border financing system for their subsidiaries in CEE. "Using the 'Umbrella Facility' in combination with our leading role in Central and Eastern Europe we can support our clients with optimal financing solutions", said the Director for Corporate Banking, talking about the product which was selected as the most innovative financing solution in 2011 at the Finance Symposium in Alpbach.
Enquiries: Bank Austria Press Office Austria
Julia Wegenstein, Tel. +43 (0) 50505 - 52854
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