Raiffeisen stresses commitment to CEE
No region is suffering more from the retrenchment in cross-border capital flows than central and eastern Europe. And no country’s banking system is more exposed to the region than Austria. These banks’ collective exposure amounts to 70% of Austria’s GDP.
Still, anyone expecting the Austrians to start beating a retreat has been disappointed. "We have never considered and have no intention of exiting any country," says Martin Grüll, chief financial officer at Raiffeisen International, which has operations in 17 countries in the region.
"We have a long-term strategy and while growth will be dampened we will stick to our business model," he adds.
Last month the bank, which is a member of the RZB group, announced that it had made a consolidated profit of €56 million in the first quarter, down 78% compared with the same period a year earlier. The biggest reason for the decline is that provisions for impairment losses rose by 379% year-on-year to €445 million.
Anecdotal evidence suggests that liquidity remains constrained in the region. Stories abound of western banks pulling credit lines. Organizations such as the Institute of International Finance estimate that cross-border capital flows to emerging Europe are collapsing.