The Bank of the Year winners from western Europe.

Andorra: MoraBanc

Banks operating in Andorra have had to adjust their business strategies to comply with new regulations as well as cope with pressure now being imposed on all offshore jurisdictions when it comes to their transparency.

No bank in Andorra has negotiated with these challenges more effectively than MoraBanc, which wins the award as bank of the year in the country for the way it has restructured its strategy to increase growth while delivering the best financial performance among Andorran banks with a profit of €45.2m.

MoraBanc, which has an A- rating from Fitch, bases its sound profitability on its business mix, which is focused on off-balance-sheet funds rather than deposits, with fees and commissions the largest source of operating income, at 70%, at the end of 2012. 

While some companies are exiting Andorra, MoraBanc has decided to continue using the tiny country as a satellite – a decision based on Andorra’s solidity and independence and the belief that it is easier to provide customers with a better quality service from such a location.

However, the bank has also adopted a strategy of attracting customers from new markets in order to diversify its source of funding, and the success of this approach is shown by an 11-fold growth in assets in 2012.

Its strategy includes measures to regularise its clients’ situation in their countries of origin. This allows them to both maintain their financial positions in MoraBanc and declare their assets in their country of residence.

The bank is also diversifying geographically, consolidating its operations in Miami and Zurich as well as entering the Uruguay market. It has also opened a representative office in Dubai.

A fund management business has also been opened in Luxembourg to offer competitive and ‘European passport’ investment funds. MoraBanc already offers Sicav investment schemes domiciled in Luxembourg.

Austria: Hypo Landesbank Voralberg

In an extremely challenging economic environment in Austria, Hypo Landesbank Voralberg (HLV) has delivered the best financial performance in the country, while reinforcing its capital and developing a sustainable business model.

Its results, including an €111.6m profit, a debt-to-equity ratio of 15.79%, a core capital ratio of 9.84%, and an increase in its deposit base to €5.5bn have earned HLV the award as Bank of the Year in Austria.

The bank’s record has won it an A1 rating by Moody’s, the best rating in Austria, and in the past year it has strengthened its foundations through an increase in its capital base.

HLV has repurchased two outstanding hybrid capital loans and the necessary capital replacement was accomplished through the successful issue of a subordinated retail bond in late 2012. “This was our biggest success in the year, generating a gain of €40m through the buyback of our Tier 1 capital and – even more [impressively] – selling €100m Tier 2 capital through our branch network in November at yields that were far below those of the big Austrian banks,” says Michael Grahammer, chief executive and chairman of HLV’s managing board.

The bank is continuing to focus on customer service. This approach is reflected in the number of initiatives it has launched, including the merger of Hypo Immobilien and Hypo SüdLeasing to create synergies in management and, in particular, real estate leasing. 

HLV has also expanded its direct banking through the growth of hypodirekt.at, which focuses on transparency and clear parameters in determining interest rates.

The bank has also built on the strengths of its asset management business, combining a wide range of products with expert, individual advice and an emphasis on supporting customers. Its innovative strategies have been well received and include funds which enable investors to benefit whether stock prices are rising or falling.

Belgium: ING

In a banking environment where consumer trust is extremely low, ING Belgium has increased its customer base while providing a better quality of service through a major commitment to developing mobile and smartphone banking.

The results have been a significant growth in the bank’s share of the Belgian market – it now has 19.2% of the private individual sector – and a strong financial performance. In 2012, ING Belgium generated a net profit of €833m, while its solvency ratio (14.2%) and liquidity position remained strong. This performance, and the investment in new delivery systems – it is the first bank in Belgium to offer mobile sales – have earned the bank the award as Bank of the Year in Belgium.

Mobile sales with ING Belgium are now possible through an app which has now been downloaded 272,000 times and can be used for acquisitions, cross-selling and lead generation. Clients can open a current account, savings account, travel insurance or a pension savings plan via their smartphone. Moreover, 25% of ING Belgium’s online credit card sales are completed via smartphones and some 5 % of appointments with branch staff are made by clients via mobile. 

“Our capacity to make banking easy, to respond to our clients’ changing needs and expectations, has been our biggest achievement in the past year, including the continuous improvement of mobile banking solutions for both our private and business clients,” says the bank’s chief executive, Rik Vandenberghe.

The app development was a key element in ING Belgium’s transformation into a universal direct bank offering simple products and a helpline for support. 

“To satisfy our clients’ heightened expectations of mobile and easy banking, simpler processes and further process automation are needed, which has wide implications on our organisation and the way we conduct our business,” says Mr Vandenberghe. 

Denmark: Nordea

Although the Danish economy is showing signs of recovery, the recession that has gripped Europe is still making its presence felt throughout the country. The resulting general uncertainty continues to influence both household and corporate decision making, resulting in slow consumer spending, low levels of investment and a focus on reducing debt.

Despite the financial crisis, low interest rates and slow activity, Nordea Bank Danmark achieved a better return on equity (4.4%) than its competitors. This factor, combined with a robust credit quality and declining loan losses, have earned the lender the Bank of the Year in Denmark title.

One of the bank’s strengths – reflected in its results – has been its ability to adapt early and rapidly to any signs of financial crisis. It has continually increased its efficiency while supporting a growing number of customers.

Nordea Danmark, which has an AA rating from both Moody’s and Fitch, continues to meet its targets on income initiatives, cost efficiency and improving its capital position. It is ensuring a core Tier 1 capital ratio above 13%, in line with its new capital policy aiming at both providing a solid bank for customers and a good dividend potential for shareholders. It is also implementing a detailed plan to reach a return on equity of 15%.

The bank continues to increase its customer base, attracting new business through its ability to support households and help corporate customers cope with the effects of new regulation. The aim is to strengthen customer relations, ensure good solutions and enhance efficiency in capital consumption. 

“A major achievement has been the continued strong inflow of new customers across both household and corporate segments. Driven by customers’ changed ways of using the bank, Nordea has at the same time significantly lowered costs, and during [this period of change] high customer satisfaction has been maintained,” says Anders Jensen, Nordea Danmark’s chief executive.

Finland: Nordea

As has been the case in other parts of Scandinavia, the past few years have been particularly difficult for Finland’s financial sector, with the country’s economy struggling to climb out of a recession that is pushing down corporate investment while exports are being further depressed by weakening global demand. Household wealth is also falling, creating a lack of confidence which has lowered mortgage growth.  

Despite this backdrop, Nordea Finland has coped well, launching impressive product initiatives and outperforming its rivals when it comes to end-of-year results, clinching the bank the country award for Finland.

While several banks in Finland reduced credit and loans, Nordea was able to increase efficiency while supporting a growing number of customers despite intense competition, an approach that has vindicated its operating model and values in a volatile and changing environment.

This approach has delivered an 8% rise in profits for 2012 to €1.19bn and enabled the bank to maintain its strategy of supporting both household and corporate customers. Nordea’s market position in Finland is very strong. Market share in household mortgages, deposits and lending is about 30%, while its position in corporate lending and the deposits market is also strong, with shares of 28% and 34%, respectively.

“For several quarters, we have managed to remain stable and [maintain] strong business momentum. Further measures have been taken to improve efficiency and to maintain flat-cost development. We have stood by our customers and at the same time managed to attract 50,000 new household and 8500 corporate customers in Finland,” says Ari Kaperi, Nordea’s country senior executive for Finland.

The initiatives that have enabled the bank to maintain this position include an expanded debit cashback service and the sale of general insurance products.

France: BNP Paribas

The award for the Bank of the Year in France has been won by BNP Paribas, which has performed strongly, delivering increased profits in what has been a difficult economic environment and against the backdrop of completing an ambitious deleveraging plan.

The net profit of €6.6bn in 2012 represented an 8.3% increase on 2011, while the bank also enjoyed a return on equity of 8.9%, results which placed BNP among the most profitable banks in the world. During this period, BNP’s financing of the French economy grew by 1.5%, even though there was a fall in demand for loans.

The bank has also demonstrated a considerable capacity to adapt to the new regulatory environment, and is well ahead of schedule for meeting new balance sheet requirements under Basel III. Its liquidity reserves stood at €236bn at the end of June 2013.

BNP Paribas is now in a position to grow its international network and strategically important businesses in key regions. A series of initiatives have already been taken to extend the bank’s operations.

A system to enable the bank to operate in a more simple and efficient way has already delivered cost savings of €330m in first half of 2013, while the launch of Hello Bank! has given BNP an advantage in the highly competitive internet market by offering a full digital service with attractive rates and an agile mobile service.

The bank is also looking to develop its asset management business, targeting institutional clients, Asia-Pacific and emerging markets and distributors, with whom it aims to create one of the three largest distribution platforms in continental Europe. It is also planning to extend its business in Germany.

Germany: Hypo VereinsBank

Hypo VereinsBank (HVB) has won the award as the Bank of the Year in Germany on the back of its strong results for 2012, including a substantial increase in profits. During this time it has also realigned its business model in response to the rapidly changing economic and regulatory environment in Europe.

HVB’s net profit for 2012 was €1.29bn, a 32.5% rise on 2011. The results also show that the bank has a strong capital base, which has been gradually increased to the point where the core capital ratio at the end of 2012 was 17.8% and the core Tier 1 ratio (without hybrid capital) was 17.4%. In 2013, the core Tier 1 ratio had risen by 19.1% by the end of June. This, combined with the constant reduction of risk-weighted assets and a sound liquidity base, makes HVB an extremely stable bank.

“Our performance proves the success and resilience of HVB’s customer-centric business model paired with cost and risk discipline and a best-in-class capitalisation,” says Dr Theodor Weimer, the board spokesman of HypoVereinsbank and country chairman for Germany at parent company UniCredit

The bank is building on this success by making a major strategic realignment. This has involved regionalising its banking operations in Germany and increasing its focus on encouraging entrepreneurs.

This has enabled HVB to get even closer to its customers and define clear responsibilities for results and leaner decision-making processes, thereby boosting both efficiency and profitability.

The resulting structure brings the bank more in line with standard international practices and is employed in similar form by its parent company.

HVB is taking further measures that are designed to ensure the competitiveness of its mass-market operations. In addition to setting up new distribution channels – heavily in demand by customers – this also requires a streamlining of the branch network and an alignment of personnel capacities with the change in customer behaviour.

Greece: Piraeus Bank

Greek banks have been adversely hit by the country’s prolonged recession, while their involvement in the sovereign debt restructuring had a significant impact on their equity and capital adequacy. Managing financial institutions requires considerable skill in these conditions and Piraeus Bank is the Bank of the Year in Greece for not only surviving, but implementing a strategy that has transformed it from a distant fourth position to the largest bank in the country.

Piraeus Bank has successfully raised the equity capital required (€8.4bn in total) as part of its recapitalisation process and acquired banks, achieving the highest private investor participation rate (20%) among the country’s lenders.

Piraeus has acquired six banks in the past year, which enabled it to decrease its loan-to-deposits ratio from 156% at end of 2011 to 115% in March 2013, and to diversify its deposit composition away from costlier time deposits, at a time of excess liquidity pressures for the Greek banking system. In addition, net Eurosystem funding as a percentage of total assets decreased from 38% in 2011 to 12% in March 2013.

Even though the economic environment in Greece is very difficult, the bank continues to improve asset quality. It is one of the banks that has done the most to tackle non-performing loans in Greece, with a provisions-to-loan ratio of 15.3% in March 2013. At the same time, Piraeus had the highest core equity Tier 1 ratio among systemic Greek banks of 14.5%. 

Piraeus’s six acquisitions comprise of the ‘healthy’ part of ATEbank, Geniki Bank, Cyprus Popular Bank, Hellenic Bank, Millennium Bank Greece and the Greek banking operations of Bank of Cyprus. This means that it now has a 30% market share in loans and 29% in deposits in Greece, as well as the largest distribution network nationwide with 1306 branches, servicing some 5.5 million active customers.

Iceland: Arion Bank

The Icelandic financial sector is starting to perform strongly again after its horrendous experiences in the immediate aftermath of the financial crisis, and among its banks, Arion Bank stands out for having the lowest non-performing loan level at 6% and for taking a number of highly successful funding initiatives.

“In a challenging environment we succeeded in continuing to build a strong capital base and produce good results. We strive to be progressive when it comes to product development and have introduced several new innovative products and services to accommodate the ever-changing needs of our customers,” says Höskuldur Ólafsson, the chief executive of Arion Bank.

Arion was the first Icelandic financial institution to issue an international covered bond programme, which is listed in the Luxembourg stock exchange, and the first to complete a non-indexed fixed-rate covered bond offering. In February 2013, Arion completed a senior unsecured bond issue in Norwegian kroner which is now listed on the Norwegian stock exchange. This was the first international bond offering by an Icelandic financial institution since 2007, an important milestone in the regeneration of the country’s economy.

These developments will enable the bank – which operates a universal banking model and owns profitable payment processing, fund management and life insurance subsidiaries – to take full advantage of its strong market position in the larger corporate, mortgage, asset management and corporate advisory markets.

Arion’s strategy remains based around innovation and developing products and services that respond rapidly to the ever-changing needs of customers. These include Iceland’s first non-indexed mortgages with fixed interest for five years. It also places strong emphasis on internet and mobile technology, and has introduced a banking app for smartphones. 

To keep returns high, Arion has also focused upon increasing fee income through new services and products, an approach that has already had a positive impact on commission income. The bank is also targeting funding opportunities for large domestic corporates and municipalities that have been partially funded by foreign financial institutions. This will enable it to grow its corporate loan book, as foreign financial institutions are decreasing their exposure in Iceland.

Italy: Intesa Sanpaolo

The award for Bank of the Year in Italy has been won by Intesa Sanpaolo, which has delivered better results than its competitors and remains strongly capitalised. It has also launched an account specifically targeted at young people.

Despite a backdrop of recession in the eurozone and Italy’s sovereign debt crisis, Intesa Sanpaolo delivered a €1.6bn net profit for 2012 while further strengthening its capital ratios to a point where they are higher than those outlined under Basel III legislation. 

Operating income increased by 6.5% to €17.9bn in 2012, achieved through strengthened operating income and decreasing operating costs as well as an increased focus on growing earnings from investment banking and insurance.

The contribution from trading profits amounted to €2.2bn, more than double the figure for 2011, due in part to the positive effects of Intesa Sanpaolo’s buyback of €711m of subordinated Tier 1 notes. Income from the insurance business rose to €828m, up from €540m in 2011.

“In a challenging environment... Intesa Sanpaolo has worked hard to deliver a first-class performance and shareholder returns while maintaining a solid balance sheet and meeting future regulatory requirements ahead of schedule,” says Intesa Sanpaolo chief executive Carlo Messina.

Over the past few years, the bank has supported the Italian government’s securities market during the most critical phases of the crisis and launched numerous initiatives aimed at stimulating the creation of new businesses, promoting innovation and encouraging Italian firms to become more internationally oriented.

Intesa Sanpaolo has continued to expand its start-up initiative – a comprehensive programme aimed at technology start-ups looking for business opportunities – and it has continued to develop Superflash, an internet-based brand for customers aged between 18 and 35.

Luxembourg: Banque et Caisse d’Epargne de l’Etat

Banque et Caisse d’Epargne de l’Etat (BCEE) delivered strong results in 2012, including a €228.9m net profit, while introducing products including an online branch and the e-Zebra packaged account for private customers, earning it the award for the Bank of the Year in Luxembourg.

“The main challenges we have faced over the past few years have been maintaining efficient cost management and a strong development of our branch network and electronic banking. We consider our high solvency ratios, the continuing growth of our net profit and the fact [that we have been ranked as] one of the 10 safest banks worldwide as being the main successes achieved,” says Jean-Claude Finck, CEO of BCEE.

One of the key initiatives launched by the bank has been its online branch, which connects with customers through telephone, e-mail and Skype, and offers extended opening hours; and the e-Zebra account, which includes an ‘all-inclusive’ package for private customers, with a focus on electronic channels for everyday banking transactions.

These initiatives reflect BCEE’s commitment to developing a bank that customers can access through a variety of channels and creating accounts to meet their specific needs.

BCEE’s branch network is still strong, but the bank also offers remote advice through non-physical channels. As well as the most modern ATM network in Luxembourg, BCEE has developed an interactive internet site, which gives useful financial information.

This internet banking system, called S-net and fully access-secured by Luxtrust, caters for all banking services, and is available for PCs and tablets. The growth in the number of S-net customers has seen BCEE rise to the lead position when it comes to online banking among Luxembourg’s financial institutions.

Other new products include the launch of gradual rate deposits, for accounts denominated in euros for terms from 18 months to five years, with or without an exit option.

Malta: HSBC Malta

The award for Bank of the Year in Malta goes to HSBC’s subsidiary in the country. Its return on equity for 2012, at 23.8%, was slightly better than that of other Maltese banks, but what really set it apart from the competition was the development of its online and mobile banking service, and its Malta Trade for Growth (MTFG) initiative.

“All three main business lines of HSBC Malta – retail banking and wealth management, commercial banking and global banking and markets – were profitable in 2012,” says Mark Watkinson, chief executive of HSBC Malta. “The bank’s capital and liquidity position remains strong. Despite the current global and regional challenges, HSBC Malta has a clear strategy in place of assisting its customers, and Malta, to access broader global markets with faster growth, simplifying our business, improving the customer experience and driving greater organisational efficiency,” he adds.

One key element of its strategy is the MTFG initiative, which is aimed at businesses wanting to explore new import and export opportunities beyond Malta’s traditional European trading partners. The initiative does this by looking at fast-growing and emerging markets mainly in Asia-Pacific and Latin America. More than 400 leads have been generated for customers and HSBC Malta will be expanding the scheme’s scope by making funds available to customers at more advantageous terms, provided they are used to expand cross-border trading.

HSBC Malta has continued its €10m investment programme to upgrade its IT systems as well as another €11m project to refurbish its branches and install next-generation ATMs. It has also launched its HSBCnet mobile service, which offers business customers the convenience and flexibility of accessing the bank’s business internet banking platform from their mobile phone. HSBC Malta is also testing its mobile banking platform for personal customers as well as a new internet platform.

Netherlands: ING

ING’s results for 2012 (a net profit of €3.1bn) were slightly better than its competitors, but the main reason for it being named as the Bank of the Year in the Netherlands is that it has the most clearly defined strategy to cope with the current banking environment. 

In the past year, ING has continued to simplify its organisation and has taken steps to reduce further its risk profile. Its product range has been streamlined, its balance sheet strengthened and its capital and funding position improved, while liquidity remains strong. 

The bank’s strategy is based on delivering customer-focused services, operational excellence and balance sheet optimisation – and to do this it is creating a single retail banking model. Measures taken to help achieve this goal have included the sales of ING Direct Canada and ING’s stakes in Capital One and ING Direct UK, which have enabled the bank to focus on its core activities and strengthen its balance sheet.

ING’s capital, funding and liquidity positions are being strengthened – even though this had an impact on profits – to meet Basel III regulatory requirements, and the bank continues to take a prudent approach to risk in a volatile environment. This has enabled ING to stay ahead of most other European banks when it comes to repaying state aid received in the aftermath of the financial crisis in 2008.

This process of generating more capital and liquidity will be maintained under the bank’s recently launched Ambition 2015 strategy. Another of its key elements is combining retail and commercial banking activities in certain countries, pursuing innovative distribution in retail banking and exploiting its strengths as a leading commercial bank in the Benelux region.

Retail banking will focus on simplifying the bank’s business model through a ‘direct when possible, advice when needed’ approach. ING’s commercial banking will focus on its key franchises and maintaining its leadership position in key markets and product areas. In the Benelux region and central and eastern Europe, ING is the leader in specialised finance and financial markets.

Norway: DNB

The award for Bank of the Year in Norway has been won by DNB, which has launched a series of services and products designed to keep customers more directly in touch with the bank, including 24-hour banking. 

Norway is not an easy market in which to deliver strong profits. With higher capital requirements from the Norwegian Financial Supervisory Authority, banks need to focus on increasing margins between lending and deposits, while selling more capital efficient products. 

The bank, which delivered a 6.3% increase in profits to NKr13.79bn ($2.26bn) in 2012, and maintained its non-performing loan ratio at 1.5%, has continued to improve its reputation for delivering quality services to both retail and corporate customers.

It has done so by reinventing itself as an open bank for customers, which means it is possible to talk to a member of staff and carry out banking services around the clock on every day of the year. This service is available to both small and medium-sized enterprises (SMEs) and private clients.

Traffic on DNB’s phone and internet banking services has increased, largely on the back of customers more frequently doing business outside of normal banking hours. For example, the bank reports that an SME client rang at 5am having realised he had forgotten to run his company’s salary payment the previous day. He was able to make the payment immediately.

DNB has also recently introduced an option for clients to transfer up to NKr500 between accounts by using text messaging.

Portugal: Banco Santander Totta

The economic conditions in Portugal have been persistently difficult, but Banco Santander Totta has managed to produce solid results while keeping finance flowing to the real economy, a performance which wins it the country’s bank of the year award.

“Despite the very adverse economic environment, Banco Santander Totta made a profit in 2012 and in the first half of 2013. It was also able to reinforce its capital, thanks to internal income generation, as shown by the increases in the core capital and Tier 1 ratios, which have now reached the comfortable levels of 13.3% and 14.6% (for the first half of 2013), respectively,” says the bank’s chief executive, António Vieira Monteiro.

The reinforcement of Santander Totta’s capital base came while the bank made profits of €250m, the highest net profit of any Portuguese bank in 2012. Recurring income, based on domestic commercial banking, reached €115m for the year.

“These excellent results derive, above all, from growth in deposits, a 9.5% reduction in operating expenses and strict and judicious risk management, which allows us to anticipate the difficult situations of families and find mutually agreed solutions. Also, we are not weighed down by costs related to state capital increases or guarantees,” says Mr Monteiro. 

An important element in implementing Santander Totta’s strategy of financing the Portuguese economy was a €1.5bn financing line to support Portuguese companies and the wider economy – some 3630 financing operations worth €803m were approved by the bank in the final quarter of 2012 alone.

It has also supported retail customers who have been adversely affected by recession, implementing a management programme to help customers deemed at risk, which is done through the identification of problems and agreeing the best solutions. This includes greater repayment flexibility, a measure that has made it possible for Santander Totta to substantially reduce the number of its private customers in distress.

Spain: CaixaBank

Like many countries in the region, Spain has suffered from the eurozone recession and conditions have been extremely difficult for its banks, which have consequently struggled to deliver strong financial results.

However, the best have been prepared to modernise and restructure and, of these, CaixaBank stands out for its impressive technology initiatives and the manner in which it has successfully taken over two banks in the country.

In the past year, CaixaBank has integrated Banca Cívica and Banco de Valencia, optimised its cost base and maintained its commercial focus, enabling the bank to cement its role as leader of the Spanish banking market (it holds 26.7% of retail banking, 15.2% of the loan market and 13.8% of deposits).

“Completing the integration of the recent acquisitions of other banks amid a complex environment was a major focus for CaixaBank and we managed to do this smoothly and in record time,” says Isidro Fainé, chairman of CaixaBank. “Furthermore, we continued to pursue sustained growth through the generation of income from banking business and investments, reducing costs and achieving synergies while maintaining the highest levels of prudence in risk management.” 

The bank works on the belief that innovation is the key for competitive and efficient growth, as well as being vital for addressing the changing needs of the customers. In 2012, CaixaBank invested Ä150m in technology development, Ä31m of which was invested in research and development and innovation.

As a result, the bank now has an impressive array of contactless technology, enabling customers to make secure payments by taking their mobile phone or card to an ATM or point of sale terminal. There are now more than 1.2 million CaixaBank contactless cards, with customers benefiting from being able to do transactions approximately 30% more rapidly.

CaixaBank is also a leader in Spanish life insurance and pensions through subsidiary VidaCaixa (which has 3 million customers and Ä43bn in assets under management) and maintains strategic holdings in five major banking groups, operating in central and eastern Europe, China and Mexico.

Sweden: Handelsbanken

A sustained high-quality service, the extension of its out-of-hours service to customers through online and phone banking, and the continued commitment to its business model have again delivered excellent results for Handelsbanken and won it the award as Bank of the Year in Sweden.

Its 2012 results delivered an 18.1% rise in profits to SKr14.55bn ($2.2bn), while its return on equity increased to 14.7%, its Tier 1 capital was up by 9.4% to SKr102.33bn. Its loan loss ratio for 2012 was a low 0.08%

These reflect the bank’s determination to create value in all financial conditions and at all stages of the business cycle. Even during the financial crisis, Handelsbanken continued to expand its range of products and opened new branches. At no stage in the past five years has its return on equity fallen below 5% and it is the only large bank in Sweden that has not used central bank facilities, state-guaranteed funding or made a rights issue during the crisis.

This approach has not only won the support of shareholders, but has also enabled Handelsbanken to have more satisfied customers than any other Swedish universal bank with a nationwide branch network.

The bank balances its adherence to traditional banking principles with a policy of modernising its services – new branches and meeting places are being opened in the bank’s home markets.

It is also introducing online services and new digital solutions for smartphones and tablets. And the bank’s unique customer service – Handelsbanken Direct Personal Service – operates 24 hours a day, every day of the year, and is staffed by qualified bank personnel.

The bank’s strategy will be to give priority to organic growth in the form of a broader range of products to a wider group of customers through an increasing number of branches in more markets. 

Switzerland: Credit Suisse

The Swiss financial sector has – like many others in the world – been forced to cope with challenging global market conditions, characterised by low interest rates and a high degree of macroeconomic uncertainty, all of which have led to a reduced level of investor activity. Moreover, the cost of doing business in the country has been rising due to growing regulatory requirements.

However, Credit Suisse has continued its success of recent years by using its client-focused model, winning it the Bank of the Year award in Switzerland.

“We made significant progress in adapting our business to the new environment while continuing to achieve strong client momentum and improving profitability. We also successfully optimised our in-house research expertise and investment strategy framework to provide our clients with superior, tailored investment advice,” says Hans-Ulrich Meister, head private banking and wealth management at Credit Suisse.

This strategy is vindicated by the bank’s results for 2012, which showed a 99% increase in profits to SFr3.58bn ($3.93bn). It also generated solid revenues and an underlying return on equity of 10% for the year, a figure that rose to 13% for the first six months of 2013, while reducing its Basel III risk-weighted assets to enable it to meet its SFr280bn target by the end of 2013.

The bank has also created an integrated private banking and wealth management division which has a strong global presence, and will continue to be a key revenue driver for the bank. By the end of 2012, the division had SFr1251bn in assets under management. The investment banking division has also been transformed to be Basel III-compliant.

 “We are committed to growing our business in a disciplined and focused way. In addition to building on our strong Swiss franchise, we will continue to drive our international client offering – particularly in the emerging markets,” says Mr Meister.

Turkey: Akbank

The award for the Bank of the Year in Turkey has been won by Akbank, which has delivered strong results and been involved in ground-breaking activities including the first Turkish lira-denominated Eurobond and the first agreement among Turkish lenders with a Chinese bank to encourage bilateral trade finance.

The bank’s net profit increased by 18.5% to Tl3bn ($1.49bn) in 2012 with a return on equity of 15.1% and a return on assets of 2%. Business grew in almost all areas of the bank’s business and this growth was achieved while maintaining a tight control over risk and ensuring stability.

The non-performing loan ratio of 1.2% continues to be one of the lowest in the Turkish banking sector, well below the national average of 2.7%. Its robust capital ratio (the bank’s capital adequacy ratio is 17.9%, of which 16.3% is Tier 1), high net stable funding ratio, low leverage and effective risk management policy give it the foundations to benefit from Turkey’s growth potential.

“We have dramatically improved our profitability and presence in the market. We have gained remarkable market share in almost all areas, we have significantly improved customer revenues, and we have further improved the bank’s World-class efficiency ratios. And despite our fast growth, we were able to maintain our high asset quality,” says Hakan Binbasgil, chief executive of Akbank.

The bank’s most important development, which has long-term implications for the Turkish financial sector, was the launch of its Tl1bn Eurobond issuance with a five-year maturity. This was the first time that a Turkish institution had issued a Turkish lira-denominated Eurobond to global markets from Turkey.

Akbank has also looked to develop its international business links, making a particular effort to participate in the booming commercial relations between Turkey and China. 

UK: Lloyds Banking Group

The past 12 to 15 months have seen a remarkable transformation for Lloyds Banking Group as it has strengthened its balance sheet, improved efficiency, become the best performing bank stock in the world, supported the UK economy and successfully sold part of the government stake in the bank.

This performance, which has seen the bank return to profitability with a net profit of £2.13bn ($3.43bn) in the first half of 2013, earns Lloyds the award as the Bank of the Year in the UK.

“We’ve made substantial progress in becoming a stronger, more agile and simpler business, significantly strengthening our balance sheet and substantially reducing costs. In turn, this is enabling us to increase our support to the UK economy and to customers through increasing the value for money we offer, while our progress has also been reflected in our share price, which has been the strongest performer of all major global banks in the past 18 months,” says group chief executive António Horta-Osório. 

This approach has been vindicated by the markets. Some £3.2bn was raised by the sale of 6% of the bank, all of which was held by the government. The bank was the strongest performer in the FTSE100 in 2012, with its share price rising by 85%, and it has been the best performing major bank stock in the world over the past 18 months.

Lloyds has strengthened its balance sheet by £15.8bn in the first half of 2013, and become more efficient by reducing total costs by 7% in 2012, meeting the target cost base of £10bn two years ahead of schedule.

The bank is also supporting the UK economy with the loan book returning to growth in the first half of 2013, with commercial banking loans growing by 4%. It became the first bank to participate in the UK government’s Funding for Lending Scheme and in the year to June 2013, it had achieved a 5% net positive lending to small and medium-sized enterprises.

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