A Detailed Overview of CEE Bank Players

Wednesday, August 12, 2009

Unicredit analysts have compiled a detailed study on the Central Eastern European (CEE) banking sector (HT Ed Hugh). While I cannot share their wishful thinking in terms of a speedy recovery this is nevertheless a compact first-hand guide to the area that will decide the fate of Austria's major banks.
I recommend you to download the 46-page PDF here as it has a valuable annex on the top players by country. This is a good base to estimate foreign banks' risk regionally.

GRAPH: First some bank macro. Except for The Czech Republic, Slovakia and Turkey loan/deposit ratios show a net indebtedness for all other CEE countries. Table courtesy of Unicredit. Click to enlarge.
Anecdotal evidence tells me that credit will furher contract in a death spiral of an economy trapped in deep recession while banks stop lending. Pick the banking group of your choice if you intend to gamble on the CEE recovery.

GRAPH: Top banks by volume in CEE. Raiffeisen International has the biggest exposure and is active in Russia and the Ukraine, both contracting like - well, the rest of the earth. Chart courtesy Unicredit. Click to enlarge.
Another decision helper concerning risks and rewards in CEE may be IMF commitments. As said, if the sky caves in on CEE Austria may face the biggest problem only in the future, contrary to the modest optimism banks put on their face these days.

GRAPH: The IMF's commitments to CEE engulf tiny Austria whose fate is highly dependent on a recovery in its former eastern territories. Chart courtesy Unicredit. Click to enlarge.
If you are in the mood to have a few more pages of worthwhile CEE information, download this PDF from Erste Research Group.
For still more recent details blogsearch Austrian banks


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