Erste Bank Hungary to streamline business

MNB

Erste Bank Hungary on Thursday said it would streamline its business structure by the end of next year.

Most of the bank's leasing and factoring activities will be merged into the parent company, and cross-ownership within the group will cease.

Erste Bank Hungary chairman-CEO Radovan Jelasity said the streamlining aimed to simplify the structure of the group, which has more than ten units, to reduce lending and operating risks, to increase structural transparency and to improve operating efficiency.

The streamlining was made necessary by the unfavorable economic environment, the negative effect on banks of regulatory and economic policy measures, the need for higher risk reserves, falling retail and corporate lending activity, and the burden of the bank levy as well as an early repayment scheme for foreign currency-denominated mortgages.

The restructuring will not affect Erste's presence on the leasing and factoring markets in Hungary.

Erste will not reduce headcount because of the streamlining, the bank said when asked by MTI.

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