Ömer Tetik, CEO of Banca Transilvania, took part again this year in ZF Bankers, where he spoke about the banking market, BT’s plans, the sectors the bank is investing in, BT Italia, BT Pay Italia & Romanians worldwide.

• In the first two days after the first round of the presidential election, there were many factors at play: speculative moves, fear, repositioning and closing out positions. Many funds and investors had a long run of gains and wanted to take profits rather than close at a loss. There may have been an exchange-rate move that had been due for some time and then happened very quickly, but we are already seeing retail and corporate clients who bought euros switching back into lei. That’s why the rate eased a little. As for the exchange rate, we’ll see in the period ahead; it depends on the formation of the Government and its programme. I think there will be another step towards 5.1 lei per euro or 5.15 lei per euro by the end of the year or early next year. That’s normal; currencies across the region, in emerging markets, have depreciated. We may have lost some competitiveness.
  
  
• Interest rates are high, but there are also many imbalances. Banks — our competitors and ourselves — are making 20-25-year mortgage loans at 4.7%, 4.8%, 4.9%, while government securities are at 7.5% and deposits at 5.5%. In a way, everything you learned in banking, economics or management school is happening the other way round. A mortgage is not just the loan itself; it’s a bundle that also includes bancassurance, a current account and cards, so it’s a profitable product even with rates this low. No one is necessarily losing money. I think we will see rates stay around current levels for a while longer, until there is a credible, balanced government plan that shows where the Romanian economy is headed.
  
  
• It’s not our goal to reach 30% market share. We want to grow alongside the economy, profitably.
  
  
• If you look at our track record over the past 10-12 years, it’s been an acquisition, then a year or two of organic growth, then another opportunity. We remain interested, and we’re looking not only at banks but also at portfolios and leasing companies, as we did in the second-pillar pensions space.
  
  
• As long as we have the opportunity to grow in a segment of the financial sector, we remain interested. Our focus will be more on delivering the results we want. We have another deal close to completion, an acquisition in Moldova with Microinvest. We are becoming the largest financier of SMEs and mid-sized companies in Moldova. For several years we have also been paying dividends in Moldova. The banking and financial sector hasn’t had such a good spell. All banks, even with volatility and instability, have maintained their lending appetite. What doesn’t work is that we lack predictability about what will happen over the next 3, 6 months and next year, from fiscal policy through to governance. That has an impact on our plans and on our conversations with clients. Overall, things are going much better than they look. Looking at our numbers, this year on the retail side we’ve had 40% growth in mortgage lending compared with last year. We are also gaining market share, I think a bit above the market average, and demand is there.
  
  
• There are sectors — real estate, for example — where we’ve never been a very aggressive bank. We truly are a universal bank. We are present across all industries. Agriculture looks set for a good year, orders are returning in IT, and services continue to perform well. In energy there has been a lot of investment in renewables; now we’re seeing discussions about storage, which is important and will provide better stability in energy.
  
  
• In the past two years, the strongest growth in our loan book has been in large corporates. We are very comfortable with the portfolio. We have grown in energy, agriculture, infrastructure, trade and retail. That also drives cross-selling across our other business lines. We will remain a present, active partner in the market.
  
  
• For us, our presence in Italy has been a learning curve. We went in intending to do retail banking and discovered that there are many SMEs and small companies owned by Romanians there. We started serving them and we now have over 700,000 BT clients from the diaspora. There is appetite and a willingness to work with their bank from home. BT will probably compete with Salt in the period ahead outside Romania as well. We prefer to go step by step. Italy is a market where we’ve already invested and have good growth; if we become comfortable there, we’ll think about another foreign market.
  
  
• I think there is still room for niche banks. Some smaller banks are profitable and deliver good returns. Economies of scale matter — you need size to be able to invest and make it worthwhile. For us, as a large bank, it’s relatively easier and cheaper. We continue to invest in our network and physical presence. That remains a viable operating model in Romania for a large bank. Smaller banks, if they don’t find the right niche, will find it very hard to compete with large banks that are present everywhere through their networks and apps.
  
  
• Our main target is to deliver the budget, and then to make sure all OTP clients stay after the integration. We have many digitalisation initiatives running in parallel and I hope we can bring some of them over the line this year.