HVB Bank Biochim/Hebros Bank

Profits at HVB Bank Biochim and the Hebros Group rose sharply in 2006, with profit before tax amounting to € 26 m. Core business remained the key contributor to these results; total assets, net interest income and net fee and commission income showed sustainable, positive growth. Operating expenses rose only moderately despite the integration process currently under way, and were cushioned by synergies realised through integration.

Retail customers:

Following the integration of HVB Bank Biochim and Hebros Bank, market share for retail loans rose from 12.0% to 13.8% – more than double the rate of the banking market. Mortgage loans grew by 35% and retail deposits by 16%.

The integration of the business customer segment led to a 51% rise in investment financing transactions over 2005. As many as 4,000 customers used the Internet banking services introduced in the final quarter of 2006 to settle over 50,000 transactions. Licences recently issued by VISA and MasterCard prompted a 20% increase in point-of-sale terminals.

Corporate customers:

Net fee and commission income in this segment rose by 18% compared to 2005. The increase was generated by the cash management services used by large international companies, and by the long-standing, fee-based business relationship maintained with local companies. The volume of new business achieved in real estate business amounted to € 150 m, an increase of 120%. In 2006, the bank confirmed its leading position in the fiercely contested segment of medium-sized companies, increasing lending volume by 18%. With a market share of 35%, the bank is also market leader in the area of public sector and public private partnership financings. By advising customers on how best to take advantage of assistance provided by the EU in conjunction with financial products tailored to meet specific needs, the bank tripled the volume of its subsidised loans.

The bank’s high service standards are also reflected in the title of "Best Bank in Bulgaria" which the bank was awarded by the renowned magazine Euromoney.

International Markets:

The focus of the newly integrated INM business segment is on derivatives and capital markets business. The bank further strengthened its position in custody business and – for the third time in succession – it was awarded the title "Best Agent Bank in Bulgaria" for both domestic and international customers by the magazine Global Custodian. The bank’s custody experts was moreover named the best team by the journal Global Investor.