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Erste Bank appoints new CEO; parent bank decides on transformation into holding company

Edit Papp has been appointed CEO of Erste Bank Hungary, effective January 1, 2007, the bank announced on Wednesday.

The announcement also said Erste Bank Hungary's parent, Erste Bank AG, had decided to transform itself into a holding company. Ms Papp will replace Péter Kisbenedek, who will take a position on the parent bank's board in charge of financial activities. The announcement said the decision by Erste Bank's supervisory board on Wednesday to transform Erste into a holding company was made because of the banking group's fast pace of growth in the Central and Eastern European region.

The bank now requires a central administration and information center as well as a base where decisions can be made quickly, the statement said. The transformation will occur in two phases. During the first phase, to last until mid-2007, the conditions for the transformation will be created. In the second phase, the legal transformation of the banking group will take place. The transformation will not affect Erste's clients, the statement said.

The holding company will control all functions of the Erste group as well as provide the infrastructure for local client relations. Erste's treasury and investment segments will be concentrated in the holding too. The holding will oversee Erste's operations in Austria as well as in the Czech Republic, Slovakia, Hungary, Croatia, Serbia, Romania and Ukraine. (Mti-Eco)