International banks increase share in central and eastern Europe
Corporates are cheering a report that suggests the imminent accession of a raft of east European countries will provide a welcome boost to banking in central and eastern Europe. The report, published by Bank Austria Creditanstalt, highlights a number of positive factors.
Personal incomes are growing above the EU average - though product usage remains below the EU mean level - and falling interest rates, combined with prospects of controlled inflation, all mean regional banks will be benefit.
The market share of international banks, in 2002, rose to 62% - although this was only an increase of 3% on 2001. "The banking market in central and eastern Europe has defied the international economic slowdown and has achieved growth, in contrast to other markets," says Martin Grûll, head of the central eastern Europe division at Bank Austria Creditanstalt. "Growth will continue in the coming years," he adds.
South-east Europe has seen notable levels of consolidation. The market share of international banks in Bosnia Herzegovina rose from 31% to 56% in 2002, while market share for international banks in Bulgaria and Romania stand at 70% and 44% respectively.
This is positive news for corporates wishing to move operations in to these markets and reinforces the prospects of economic growth in this region.