FOREIGN INVESTORS COUNCIL 2021/2022
INTERVIEW
PREDRAG MIHAJLOVIĆ, PRESIDENT OF THE EXECUTIVE BOARD AT OTP BANKA SRBIJA AND PRESIDENT OF THE BOARD OF DIRECTORS OF THE ASSOCIATION OF SERBIAN BANKS
Agile Transformation Is
KEY TO LEADERSHIP
T
hemergerofOTPbankaandVojvođanska banka is one of the most complex projects seen on the regional financial market to date. As a result, the banking market has been enriched with a large and strong bank that wishes to extend beyond limitations, support its clients in their financial plans, and to be a leader of innovation and the top-notch customer experience it provides clients, says Predrag Mihajlović, President of the Executive Board at OTP banka Srbija and President of the Board of Directors of the Association of Serbian Banks. “This integration has taught us that careful planning, a common vision and the optimism of our employees are the main reasons why we managed to achieve the set goals. The entire process took place concurrently with the coronavirus pandemic, which also taught us 28
Photo: Orange studio,by Nebojsa Babic
OTP banka’s ambition is to remain a leader in lending of both retail cash and housing loans, but also in corporate lending, paying special attention to the small and medium-sized corporate segment, as well as agricultural financing.
Because friends are there for each other in the toughest of times, OTP banka extended the partnership for the next Olympic cycle in the midst of the pandemic without hesitation, and together we are moving towards new successes at the upcoming 2024 Summer Games in Paris that challenging times can be an accelerator of great ideas, because they because they make us move, adjust and bring changes to our usual courses of action. That’s why, both in life and work, agility represents a key ability.
Do you expect further consolidation of the banking sector or is this now, more or less, a completed process? I believe that the consolidation of the banking sector will continue, both in Serbia and the region. Following our integration, we today have 24 banks in Serbia, of which the first 10 banks by asset size have around an 80% market share. This is telling us that there is a clear opportunity for further consolidation in order to increase profitability, optimise operations and enhance products and services. In addition, the first 10 largest banks generate 93% of total profit, where RoE stands at 6.5%. This means that the trend of profit concentration increases each year and that banks which are not among the top 10 must change their business model, seek for other opportunities or withdraw from the market. And we have witnessed announcements that this will happen in the coming period. The banking sector overcame the crisis caused by COVID-19 more easily, while you recorded business results that exceeded expectations. Where do you see the possibility of further market penetration under the conditions of current low interest rates? Banks were ready to face the crisis, thanks to adequate liquidity. When it comes to low interest rates, macroeconomically speaking, the advantage is that they release available money and thus stimulate further consumption and investment. The economy is growing with the increase of income and profit, which has resulted in the country’s improved credit rating. Our ambition in OTP banka is to remain the leader in lending of both retail cash and housing loans and in corporate lending with special
