HANSABANK
In an environment of tight competition, Hansabank has maintained strong profitability, posting a RoE of 45.7% in 2005, and has strengthened position in fast-growing product areas, such as consumer finance and pensions.
Its focus has been on mitigating and compensating for margin pressure with modifications on product mix and the development of tailored products and pricing offers. It has strengthened profits growth in 2005, with net profits rising by 26% and assets rising markedly by 59%.
“The Estonian banking market has experienced tremendous growth in the past couple of years. We are very satisfied that Hansabank has managed to keep its leading market position over that time,” says Priit Põldoja, managing director of Hansabank in Estonia. “In 2006, we also launched a non-life insurance business, where early signs are very promising.
“Hansabank Estonia continues to invest heavily in its distribution network. Last year, as well as this year, our priorities have been to increase the number of ATMs and to redesign the branches. Improvement of our electronic channels has been important for us as well, and will be one of the focus areas in 2007. Our one-stop-shop financial services model is working well and we are making efficiency gains in spite of decreasing margins and increasing pressure on costs.
“Cost/income below 40% and RoE above 40% are definitely numbers that prove that our strategy and execution is on the right side.”
