Csányi expects OTP acquisitions in near future

(Photo: LaMography/Moni Lazar)

“It looks like we have a chance to make several such acquisitions in the near future,” he said. “There are more banks for sale now than ever before, especially in neighboring countries,” he added. 

In Hungary, OTPʼs market share is good, and the integration of the recently acquired AXA Bank is ongoing, he said. The possible acquisition of Budapest Bank has not come up, he added; the state of Hungary acquired Budapest Bank in 2015 and earlier said it planned to sell it by the end of this year.

When asked about possible consolidation on the Hungarian market, Csányi said there are too many banks in Hungary compared to the size of its population.

Interest rates are low and inflation is “even lower than necessary”, which makes for tight margins, he said. Stricter European Union regulatory requirements create extra costs for banks, he added.

Demand for digital services is growing among the younger generation, but establishing these services requires investments that only the bigger financial institutions can make. Smaller banks will not be able to compete because of their size, and their owners will weigh the possibility of divestment, Csányi said.

Csányi was optimistic about the position of Central and Eastern European countries in the EU, saying they could produce faster economic growth than developed member states in Western Europe during the next 20 years. The effects of the UK’s Brexit decision to leave the EU are unpredictable, but new treaties between the EU and the UK will not dramatically affect the economy of the Union, the banker added.