RBI CEO plays coy on intentions for Hungary

History

Having already announced its planned scaling back in Hungary among other markets in region, a spokesperson for Austria-based Raiffeisen Bank International (RBI) yesterday confirmed to the Dow Jones newswire that several offers for Hungary-based RBI operations have been received, though stating emphatically that “We do not want to withdraw from Hungary.”

On the weekend, Raiffeisen CEO Karl Sevelda remarked that RBI did not want to exit the Hungarian market, but a statement of clarification from the bank on Monday stated that “a withdrawal from [Hungary] cannot be ruled out.”

But yesterday Sevelda got coyer on the subject, quoted in a Reuters report as teasing that “We won’t leave Hungary[; we’d rather leave] Ukraine than Hungary. But what does it mean not to leave Hungary…?”

Though “we never turn down talks” such as those for RBI’s Hungary-based unit, Sevelda once again called the country his bank’s “heart’s blood.” On the other other hand, he said “If I look at ... Hungary for instance, or now at Croatia or also Slovenia, there is no chance that banks ever will earn their cost of capital ... one shouldn’t say ‘never,’ but certainly not in the next ten years.”

RBI earlier reported a €83 million loss by its Hungarian operation comprised of 125 outlets in the first six months of 2013; for the same period in 2012, losses were €82 million from 134 outlets. As of June 30, RBI reported assets of €6.324 billion in Hungary, down 14.4% year-on-year.

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