Starting autumn, a new direct confrontation will begin at the top of the banking market ranking, between the banks filling the third and fourth positions, namely Raiffeisen Bank and the newly set up UniCredit Tiriac Bank. According to first quarter data, UniCredit was 1.1bn euros away from the bank ranking third.
However, the battle will not be fought only on the Romanian market, but in the entire region, where both banks are present, and UniCredit group can become an even more dangerous rival in the wake of its merger with HVB/Bank Austria.
In terms of efficiency, UniCredit Tiriac inherits a performance its rivals should fear, with assets worth 1.37bn euros per employee, compared with around 981,000 euros in the case of Raiffeisen, according to the data reported to the parent company for the first quarter.
In Romania, both banks have companies around them specialising on various segments of the financial market, so that the battle will also be fought at a group level. While Raiffeisen can make the most of the power of its name, present in each company member of the group, in the case of UniCredit promotion, though, the brand can be limited as many firms of the group retain their old names and the link with UniCredit group is not directly visible as a result.
The clash of the two groups is also reflected in the international press, as it has recently happened in 2 interviews of Herbert Stepic, CEO with Raiffeisen International, and Erich Hampel, CEO with Bank Austria Creditanstalt and head of the CEE unit of UniCredit group, with Euromoney magazine.
Herbert Stepic states he does not fear UniCredit, with one argument being the very advantage created by the awareness of the Raiffeisen brand in the region, in contrast with the negative effect of the frequent name changes within the current UniCredit group. The same thing happened on the Romanian market, but the awareness of used brands was not equally important perhaps, as the bank focused on services for companies and above-medium-income people who could more easily track changes.
On the other side, Raiffeisen strove to build a name particularly on the retail market, after taking over Banca Agricola, with spin-offs being subsequently created around this name to cover other segments of the financial market.
The impact of a name over the performance of a business is not to be overlooked, with an example in this regard being the rapid rise of Raiffeisen Asset Management, which gained a top position in less than a year.
It remains to be seen whether Raiffeisen's brand strength is large enough to withstand the competitive pressure that can be exerted by one of the biggest European financial groups of the moment.
Raiffeisen vs. UniCredit Tiriac
According to Q1 data, UniCredit, ranking fourth on the banking market, is 1.1bn euros away from Raiffeisen, which ranks third
The battle between the 2 banks will not be fought only in Romania, but also in the entire region
In terms of efficiency, UniCredit Tiriac inherits a performance its rivals should fear, with assets worth 1.37 million euros per employee, compared with around 981,000 euros in the case of Raiffeisen
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