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Hypo Alpe-Adria-Bank to withdraw from Hungary

The nationalised Hypo Bank will withdraw from Hungary as well as several other countries, head of the Austrian financial group Gottwald Kranebitter told Thursday's edition of the Austrian NEWS magazine.

Kranebitter, who took over as chairman of the executive board in March, said the he wants to make Hypo Group Alpe Adria profitable again over three years after it was rescued from bankruptcy through nationalization. That is why the group is divesting its "non-profitable" markets, focusing on key areas on the remaining ones.

HGAA plans to withdraw from Germany, Hungary, Bulgaria, Ukraine and Macedonia, Kranebitter said. The bank also takes the position that the EU expects the group to give up the Montenegrin and Italian markets before giving approval to the consolidation before government involvement.

On the remaining markets of Austria, Bosnia-Herzegovina, Serbia, Slovenia and Croatia - HGAA intends to focus on "key areas" such as lending, deposit collection and leasing. The bank is currently considering the possibility of selling non-core operations "at a good price" under the current market conditions.

The HGGA group's Hungarian holding is Hypo-Alpe-Adria Leasing Zrt, which leases boats, aircraft, equipment and real estate.

The Austrian Wirtschaftsblatt said in March that HGGA plans to withdraw from five eastern European countries including Hungary. HGAA then refused to comment, terming the press reports to be rumours. The bank earlier indicated plans to withdraw from certain markets such as Germany and Italy.

Information on HGAA's website shows the group employs around 1,400 people in Austria and 28 in Hungary. (MTI-ECONEWS)