French Societe Generale Group, which controls the second leading bank in the Romanian banking system, BRD - Groupe Societe Generale (GSG), wants to tackle the consumer finance market in full gear this year. To that end, the French will bring their specialised division, Franfinance in Romania.
The new entity, held 100% by Societe Generale, specialises in consumer finance and has a strong tradition in the countries in the region.
"The decision of the parent bank to also tap into the Romanian market through its consumer finance division was chiefly due to three reasons. The first reason was the confidence in the potential of the Romanian market and especially in that of the retail, i.e. consumer credit segment. The second reason was the rather low risk on the segment of lending for purchases of consumer goods and last but not least, the fact that Romania is the second market in the region after Poland in terms of number or inhabitants," Sorin Popa, BRD's deputy general manager in charge of the retail operations, told Ziarul Financiar.
The volume of credits for buying consumer and durable goods has been following a visibly upward trend since last year, with the growth in 2003 amounting to more than 300%. The big battle, and implicitly the gains, was fought "directly in stores", with the retail chains looking for all sorts of financing offers to attract as many clients as possible.
"The establishment of this company is the basis of the partnership BRD plans to develop with Franfinance and will allow us to improve the quality of services when it comes to granting loans directly in stores. This partnership will help turn this business (lending i.e.), which sees a very large volume of operations that will also need specific products implemented, into an industry," the BRD official says.
The bank currently has a number of partnerships concluded with several store and supermarket chains such as Amadeus Group, Ana Electronic, Bricostore, Carrefour, Praktiker, Primex, Romstal, Rombiz and Romsoft.
The Romanian financial market sees a similar business at the moment, that is the one developed by Credisson. It started out by supporting Flanco's consumer finance operations in 2003. The company brokers lending between banks and the final beneficiaries but also undertakes part of the lending risk. Credisson is held by two investment funds, Oresa Ventures and Danube Fund, and by businessman Florin Andronescu, who owns 20% in it.
BRD's plans to increase exposure on the retail market and implicitly on the consumer finance market this year are also shown by the new funding offer the bank started promoting this month.
Subsequently, the loans for personal needs and those for buying durables can now be repaid in four instead of three years as of April 1. Moreover, the bank has also cut the interests for such funding to 28% a year (variable interest) and 26% a year (fixed interest).
oana.nuta@zf.ro
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