Prima Pensie, set up by the Slovenia-based Prva company, expects to attract 350,000 customers for its new compulsory private pension fund and aims to account for 10% of the market.
The company has been studying the Romanian market closely for 3 years waiting for pension reform. When the wheels of reform began to be set in motion, the Slovenian financial group decided to enter the market by setting up Prima Pensie, which will manage mandatory private pensions (pillar II). Up until now, the Slovenian company is the only foreign company to voice an interest in the Romanian private pensions market.
"In the next four months, the focus and activities of the Prva group will concentrate on the launch of mandatory private pensions in Romania," says Alenka Znidarsic Kranjc, CEO at the group.
Prva is currently listed on the Slovenian stock exchange, whilst the European Bank for Reconstruction and Development (EBRD) owns 20% in it. The company's other two shareholders are both Slovenian firms.
Since arriving on the market several months ago, Prva has already employed 80 people throughout the country, who will coordinate territorial operations for the newly formed company.
"In the past two months, we've been building our network. Now, we've taken the final step in the race for getting the necessary license to manage a mandatory pension fund and estimate we'll be ready to start at the end of July," believes Damjan Mencej, chairman with Prima Pensie company.
Mencej has been working in Romania for four years and was one of the founders of KD Investments asset management company. The domestic company created by Prva is already in the final phase of authorisation along with several other contenders. At present, 13 companies are on the waiting list to be licensed as mandatory pension fund managers.
The Slovenians say they will compensate the Prva brand's domestic low profile by associating the company with Prima Pensie and EBRD, with the two companies acting in partnership.
Prima Pensie will be allocated a promotion and advertising budget "higher than that of rival companies," stated Alenka Znidarsic Kranjc.
The company would start out with a minimum share capital of 4m euros, but in order to sustain investment activities this sum would have to be extensively supplemented, added Znidarsic Kranjc.
To reach its customer target, Prima Pensie estimates it will employ a sales force made up of 20,000-30,000 marketing agents and also intends to take advantage of "channels left unexploited by our fellow competitors," the Slovenians added.
Prva is currently present on the market of private pensions in six regional states and believes the battle for market share in Romania will be much fiercer, as initially gained positions tend to remain rooted.
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