Belgium's KBC group will not carry out any large scale plans in Romania unlike in neighbouring markets, but prefers to target a niche sector where it plans to develop complete bancassurance operations.
"In Romania, we'll look into a niche sector - consumer finance, leasing and securities. Selectively, we'll also have private equity operations, with a focus on domestic companies with a relatively low market capitalisation," states Andre Bergen, CEO of KBC, who visited Bucharest in April. However, he maintains that he will not drop the idea of possible acquisitions, but does not see any potential takeover targets for now.
Early this year, KBC launched consumer finance services through its specialised unit - KBC Consumer Finance.
"We target a 3% market share by 2011, given that we'll use non-banking distribution channels," says Bergen.
The battle will be tight on the consumer finance market after US giant GE Money decided to step up development and promoting its own brand.
At the same time, KBC estimates it holds 4% of the domestic leasing market.
KBC includes Romania in the category of "new markets", besides Russia, Bulgaria and Serbia. The category's assets amount to 7.1bn euros, which includes 4bn euros in Russia and 3bn euros in Bulgaria. Romania and Bulgaria are considered to be countries with high external financing needs, but with hard to reverse capital flows, unlike the Baltic countries, where KBC is not present.
"We expect the CEE region to remain the growth driver of our group over the next few years, the economic picture of our markets further sustains this scenario, and our recent moves to strengthen our positions will start to bring in results".
Last year, the region brought the group a 618m-euro income.
In the case of KBC Securities unit, Romania is among the markets the Belgian group entered through acquisitions. The unit's CEO, Guy Van Eechaute, states that in Romania the unit mainly works with institutional clients. Corporate finance services hold a significant weight, while retail makes up a smaller portion. However, Van Eechaute expects the weight of retail clients to rise to the level of the entire region, inclusively on the basis of online distribution.
KBC's private banking unit does not have any ambitious plans for Romania, either.
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