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Zuno sold into Russian hands

LOSS-MAKING online bank Zuno, operating in Slovakia and the Czech Republic will be under new ownership as the Austrian owners have sold it to the biggest private Russian bank Alfa.

(Source: Sme)

“The change in ownership of Zuno bank will not have any influence over its clients in Slovakia and the Czech Republic,” said Ivo Trávniček, PR manager of Zuno Slovensko as cited by the TASR newswire. “Their deposits will continue to be protected according to the Austrian law on protection of deposits while Zuno remains to be an independent, fully regulated Austrian bank with headquarters in Vienna.”

ABH Holding based in Luxembourg, the parent company of Alfa Banking group has signed a sale contract with Austrian Raiffeisen Bank International regarding the sale of Zuno bank, while details of the transaction, which will still undergo the scrutiny of regulatory bodies, have not been revealed.   

The new owner is declaring an interest in investing capital into development and expansion of Zuno, the bank informed in its press release.

“ABHH has a long-term interest in development of the banking business in Europe, while Zuno represents an ideal platform for this expansion,” the press releases reads.

By acquiring Zuno, the Russians will obtain an innovative but loss-making banking house without branch offices, with 250,000 clients and an incomplete portfolio of provided services, the Hospodárske Noviny wrote. Zuno is interesting for them not only as a way to enter European markets, but also from the viewpoint of technologies as they want to build direct banking also in Russia.

Experts indicate that Zuno has not been thriving in Slovakia and the Czech Republic especially because of a limited ranking of services provided and that it was only a second bank for most clients. They have used it especially for savings, but falling interest rates on deposits reduced its revenues from this activity. It has tried to cover the losses by offering consumer loans, but this plan probably did not work as the bank ended 2014 with a loss of almost €20 million. This was a drop of €15 million from 2013, Hospodárske Noviny wrote.

Also the halt of its expansion might have harmed its performance.

“Its business model was designed for a bigger number of clients and especially more countries,” Maroš Ovčarik, analyst of the Finančný kompas website dedicated to finances told Hospodárske Noviny. “As they remained only in the Czech Republic and Slovakia, they have failed to generate enough new clients.”

Zuno bank set up a pilot operation in Slovakia in August 2010, while it launched its commercial operation in December 2010. In mid 2011 it began operations in the Czech Republic. The bank offers online and direct banking services in both countries.

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Topic: Finances and Advisory


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