Wednesday, 4 November 2020

Financial Inspectorate Fines Popular Zagrebacka Banka, Fine Discounted?

As Poslovni Dnevnik writes on the 3rd of November, 2020, the Financial Inspectorate of the Republic of Croatia has issued a decision by which the otherwise popular Zagrebacka banka was found guilty and fined an eye-watering amount.

The guilty verdict comes as a result of the supervision of the Croatian National Bank which established that in the period from the 1st of January 2017 to the 8th of November 2019, Zagrebacka banka failed to implement all of the necessary measures, actions and procedures as prescribed by the Law on Prevention of Money Laundering and Terrorist Financing (ZSPNFT). As a result of the finding, a single fine in the amount of 33,000,000 kuna was published on the CNB's website. However, as Poslovni Dnevnik/Ana Blaskovic reports, the bank has earned a discount on that huge fine, and will now pay ''only'' 22 million kuna.

According to the Misdemeanor Law, if the bank pays the fine within a month, which it will do, Zagrebacka banka will ultimately only pay the aforementioned ''discounted'' amount of 22 million kuna.

The decision of the Financial Inspectorate was made and became final on October the 30th, 2020. This fine is the highest misdemeanor ever imposed on a credit institution in all of Croatia, not only in the field of the prevention of money laundering and terrorist financing, but also in all areas for which the misdemeanor liability of credit institutions can be prescribed. In this case, the Croatian National Bank, as the supervisory body and authorised prosecutor, complied with the obligations under the Misdemeanor Law, informed Zagrebacka banka of its right to come to an agreement, which Zagrebacka banka used, admitted guilt and agreed to accept the aforementioned large fine.

Zagrebacka banka: We have implemented all of the due regulatory measures

''Zagrebacka banka has resolutely implemented all of the due regulatory measures in close cooperation with the competent authorities and remains strongly committed to the continuous strengthening of the system and its processes. The entire set of measures (75) identified by the bank, and ordered by the CNB in ​​its decision, was fully implemented three months before the deadline set by the CNB,'' Zagrebacka banka stated.

The Croatian National Bank has identified a total of 11 violations related to violations of the Law on the Prevention of Money Laundering and Terrorist Financing, in the following areas:

Risk assessment of an individual business relationship
Identifying and tracking suspicious, complex and unusual transactions
Reporting suspicious transactions to the Office for the Prevention of Money Laundering
Implementation of measures of enhanced in-depth analysis of all parties
A system of internal controls to reduce and effectively manage the risk of money laundering and terrorist financing.
The aforementioned violations established by the CNB upon the supervision of Zagrebacka banka were committed in the period from the 1st of January 2017 to the 8th of November 2019, and relate to the following omissions:

It did not implement measures of enhanced in-depth party analysis for 72 clients
It did not analyse the background and purpose of 1,126 transactions that were identified as complex and unusual and didn't have an obvious economic or visible legal purpose
For 2,028 transactions made by parties, the lists of indicators weren't used as guidelines in determining the grounds for suspicion of money laundering or terrorist financing
It failed to report 1,122 suspicious transactions to the Office for the Prevention of Money Laundering
It hasn't established an effective system of internal controls to reduce and effectively manage the risk of money laundering and terrorist financing.
The number, type and duration of identified illegalities indicated structural shortcomings in the implementation of prescribed measures, actions and procedures to prevent money laundering and terrorist financing. Such conduct is particularly unacceptable given the position held by Zagrebacka banka in the financial system of the Republic of Croatia as the largest credit institution.

The amount of the fine imposed is proportional to the determined number and severity of the committed offenses.

After the completion of the CNB's supervision, Zagrebacka banka reorganised its operations and increased its capacity to detect and prevent money laundering and terrorist financing, and proceeded to implement supervisory measures based on the decision of the Croatian National Bank. Zagrebacka banka demonstrated an appropriate degree of readiness to address all of the identified weaknesses within the anti-money laundering and anti-terrorist financing system. Among other things, Zagrebacka banka has committed itself to implementing 75 measures to increase the efficiency and effectiveness of its anti-money laundering and anti-terrorist financing system. In the meantime, Zagrebacka banka informed the CNB that it had implemented all of the measures it undertook.

This case emphasises that the implementation of measures to prevent money laundering and terrorist financing by banks remains an important priority of the CNB and that it is more than determined to take all of the measures to ensure that banks comply with regulations in the field of the prevention of money laundering and terrorist financing. The Croatian National Bank expects banks to have effective and efficient anti-money laundering and anti-terrorist financing systems that should be proportionate to their size, type, scope and the complexity of their operations.

In accordance with the law, the CNB informed the Office for the Prevention of Money Laundering in detail about their decision, as well as all competent state institutions.

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Saturday, 24 October 2020

New HPB Payment Service: Instant Payment by E-Mail or Phone

As Poslovni Dnevnik writes on the 23rd of October, 2020, the execution of payment orders which involves the immediate transfer of funds to the payee's account for clients of Hrvatska postanska banka (HPB) is set to become a reality on October the 29th, 2020. On that day, NKSInst, a new HPB payment service for the Republic of Croatia, developed by Fina and approved by the Croatian National Bank, will kick off a new era of development of modern payment service for HPB clients.

The new HPB payment service will be available 24/7, 365 days a year. HPB was among the first banks in Croatia to join a new scheme for instant payments made in Croatian kuna and offer its clients the service of conducting payment transactions in almost real time and continuously available 24/7/365. Transaction speed and constant availability, along with, as always, maximum security, are precisely the main advantages of the new HPB payment system when compared to the execution of standard payments. In order for the order to meet the prerequisites for instant payment, it must be in Croatian kuna, the maximum amount is 100,000 kuna, and the payment/payee must be assigned to a bank that has also joined the instant scheme.

Instant payments are intended for both individuals and businesses, and access to the new HPB payment service is provided through the digital channels mHPB and Internet banking. HPB is also participating in the new payment system as a payee's bank and a payer's bank.

Instant payments allow not only the shortening of the time required for the transactions, but also the possibility of executing it at the moment when it is the most convenient for the service user. It provides the payer with the possibility of the simple fulfillment of that obligation immediately, ie at any time.

In addition to payments made using an IBAN, payment orders will soon be able to be placed according to additional identifiers such as an OIB, a mobile phone number and/or an e-mail address, which the user will pre-register in the system. For these options, users will be able to easily register on mHPB and pay in just a few clicks to a specific mobile phone number from their phonebook or by entering an e-mail or OIB instead of the recipient's IBAN. Orders placed in this way will be able to be executed by both regular and instant payment.

The application of a new innovative instant HPB payment service that enables customers faster and easier financial management is a confirmation of the successful implementation of HPB's digitalisation strategy, further technological progress and dedicated work on the offering of quality to clients that brings new trends in banking and strengthens the bank's overall competitiveness.

The first participants in the NKSInst payment system, apart from HPB, are Partner banka and PBZ, and the Croatian National Bank announced that it supports the development of modern payment services and expects other banks to provide interbank instant payments to their clients throughout 2021.

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Friday, 9 October 2020

OTP Banka Strengthens Status of Leading Croatian Custodian Bank

October the 8th, 2020 - OTP banka has won the title of the best Croatian custodian bank once again, earning an enviably high rating from satisfied clients and no doubt boosting the bank's already high level of respect.

When it comes to banks in Croatia, there are many options. For those who don't want a Croatian bank account for whatever reason now also have the option of companies like Revolut and Transferwise as opposed to having to use foreign accounts which incur additional charges for use abroad. OTP banka, however, has consistently earned high ratings among both regular clients and business ones alike.

As Novac/Jozo Vrdoljak writes on the or the fifth year in a row, the well respected Global Investor / ISF magazine has proclaimed the already popular OTP banka d.d. the best Croatian custodian bank in the category of unweighted ratings according to the opinions of clients, who gave it an extremely high rating of 6.73.

It was necessary for this Croatian custodian bank to meet more than ten demanding criteria, including the provision of settlement services and corporate actions, the quality of reporting on market events, including regulatory changes, and the quality of business relationships, which is one of the most important but also the most difficult points of service for banks to meet.

The Republic of Croatia's OTP banka thus won the highest unweighted ratings as judged by the size of its clients' assets.

"This high rating confirms that clients, despite these challenging times, still consider OTP banka to be one of the best providers of care and protection for clients' assets," read a statement from the aformentioned winning Croatian custodian bank, OTP banka.

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Thursday, 17 September 2020

Croatian Banks End Coronavirus Measures, No More Debt Freezing

September the 17th, 2020 - The coronavirus pandemic might still be taking the world by storm, with a predicted rise in the number of serious cases in the upcoming colder months as the virus crosses paths with flu season, but not everyone is keeping their coronavirus measures in place. Croatian banks are one of those institutions set to scrap any special benefits garnered as a result of the pandemic,

As Poslovni Dnevnik writes on the 15th of September, 2020, Croatian banks will no longer freeze debts as they chose to do during the pandemic, and the deficits in citizens' accounts will be determined according to the last three months, depending on their employment status, the amount of their income and the regularity of their repayments.

Croatian banks are, as such, abolishing the popular measures they introduced in an attempt to soften the already dire financial blow caused by the spread of the new coronavirus.

The deadline for debt repayment and the amount of overdraft depends on the policy of each individual bank. Thus, some announced changes to their permitted overdrafts for as early as October, with the possibility of payments made in installments.

Some Croatian banks are starting with changes as of next year.

"In accordance with the General Terms and Conditions, as of September the 7th, 2020, clients will be notified of the announcement of the updates of the amount of the overdraft they're permitted to have, which will be performed on October the 10th, 2020," OTP banka said in regard to the overdraft.

"If the reduction in income is what is bothering people, then the solution can be found in extending the loan repayment period, which causes a reduction in the monthly loan obligation. And, the possibilities of easier repayment, which is in line with their new level of income,'' said Dario Gabric from Erste Bank for RTL.

Addiko Bank will start making changes next year.

"At the beginning of November 2020, we'll inform clients about the new amounts of their overdrafts on their current accounts, which will be available from the 1st of January, 2021," read a statement from Addiko Bank.

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Sunday, 19 July 2020

Privredna Banka Zagreb Wins Euromoney "Best Bank in Croatia" Award

The Euromoney Excellence Awards are given worldwide to financial institutions and banks that provide their clients with the highest level of service, innovation and expertise. Privredna banka Zagreb (PBZ) has taken home the ''Best Bank in Croatia'' award.

As Poslovni Dnevnik writes on the 17th of July, 2020, the Euromoney Awards for Excellence 2020 were awarded to Privredna banka Zagreb (PBZ), a member of the Intesa Sanpaolo Group, in the category of the best bank in Croatia, and to Intesa Sanpaolo as the best bank in Italy. As stated, the Euromoney Excellence Awards are given worldwide to financial institutions that provide their clients with the highest level of service, innovation and expertise. A wide range of qualitative and quantitative criteria need to be taken into account for this handing out of these awards and they're considered to be the most prestigious awards in the entire banking industry.

On the occasion of the announcement of this award, Dinko Lucic, President of the Management Board of Privredna banka Zagreb, stated: ''We're extremely proud of [having received] this prestigious international award that has come during these difficult COVID times. I often point this out, but it's true that the real difference is made by people, and the more difficult the situation in the world is, the more important the role of professional, calm and highly educated employees becomes. This award is a confirmation of the continuous commitment and work of our entire Privredna banka Zagreb Group team. I'm proud of all of our employees and on this occasion, I'd like to thank them for their contribution, I'd also like to thank all of our clients for whom we constantly strive to be even better.''

The Euromoney Awards of Excellence were established back in 1992 and were the first of their kind in the whole global banking industry. This year, Euromoney received almost 1,000 applications from banks for a region and country award programme that includes more than fifty regional awards and the award for the best banks in almost 100 countries.

For more on banks in Croatia, follow our lifestyle section.

Monday, 15 June 2020

What Kind of Blow will Coronavirus Pandemic Deal Croatian Banks?

When talking about the economic consequences of the ongoing coronavirus pandemic, could Croatian banks be worse off when compared to other banks operating within the country's immediate region?

As Tomislav Pili/Poslovni Dnevnik writes on the 15th of June, 2020, small and medium-sized companies in Central, Eastern and South-Eastern Europe (CESEE) will face much stricter criteria in terms of being granted loans from banks this year, is one of the main conclusions of a study by the European Investment Bank (EIB).

In addition, the share of non-performing loans will start growing again, for the very first time since back in 2015. According to the research conducted, banks in the CESEE region will face the worst business environment since the 2007 and 2008 financial crises due to the coronavirus pandemic.

In the last six months alone, banks in Croatia's immediate region have witnessed a solid demand for loans, while providing somewhat looser lending terms. However, the EIB's survey of as many as 90 banks concluded that lenders expect a sharp decline in demand for financing, as well as a significant tightening-up of approval conditions and, accordingly, a decline in the rate of approved loans.

Banks expect that it will be primarily households who will first reduce their demand for credit/loans, and not so much the corporate sector. 64 percent of banks in Central, Eastern and South-Eastern Europe expect an increase in the rate of non-performing loans in the second half of 2020.

However, the existing loan portfolio as it currently stands is expected to begin to deteriorate once again, with 64 percent of banks expecting a rise in the rate of ''bad credit'' during the second half of this year.

As for Croatia, the EIB pointed out that on the eve of the coronavirus pandemic, the Croatian banking market could boast of solid profitability, given that in the last six months more than half of foreign banking groups have reported higher returns on capital.

Given that the overall impact of the pandemic still remains quite unclear, in the next six months, Croatian banks unfortunately expect their market dynamics to fall even below regional trends. This is in line with forecasts that Croatia will experience one of the deepest recessions in the entire region, with a worrying nine percent drop in GDP.

While retail lending will be strongly negatively affected by sinking personal consumption, higher demand may come from the extraordinary liquidity needs of companies that had to shut down during the pandemic, backed by fiscal stimulus as well.

In order for banks in the CESEE region to return to pre-crisis levels and to be able to finance the domestic economy, support through instruments such as the European Guarantee Fund will be crucial, according to EIB economist Debora Revoltella.

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Tuesday, 17 March 2020

CNB Governor Boris Vujcic Explains Croatian Banking System Stability

Just how is the Croatian banking system doing in these tying coronavirus-dominated times?

As Poslovni Dnevnik writes on the 17th of March, 2020, the Croatian National Bank's Governor Boris Vujcic said that since the beginning of last week, there has been some stronger pressure on the kuna exchange rate. He also stated that the CNB has intervened and stabilised the exchange rate and announced that it will continue to work.

According to Vujcic, the Croatian banking system is currently very stable and that, despite the coronavirus epidemic which is rocking the global economy, there is currently no threat to its normal functioning, so residents certainly do not need to withdraw their cash from banks.

''As for the Croatian banking system, it's very well capitalised and very stable and there's no need for residents to start withdrawing their money from banks. At the moment, we don't see any problems that could jeopardise any normal functioning, regardless of what will happen with the virus or the epidemic,'' Vujcic told reporters.

"The kuna exchange rate will remain as stable as it has been for the last quarter of a century," Vujcic assured strongly.

Namely, since the beginning of last week, the CNB has carried out four foreign exchange interventions, through which more than 1.6 billion euros were sold to banks, bringing a total of 12.2 billion kuna out of the Croatian banking system, and yesterday, after two weeks of the weakening of the kuna, it managed to strengthen against the euro.

Vujcic said that the CNB had very high foreign currency reserves, as well as the ability to create liquidity as and when needed.

When asked about the proposals for the postponing of loan repayments and the request of a state guarantee scheme, Vujcic replied that the state guarantees should be discussed with the state, but also said that the Croatian banking system and the population as a whole are currently in an unusual situation thanks to coronavirus.

"It's in everyone's interest to overcome this situation by postponing some claims/loans that exist against those who will not be able to do business in due time due to the epidemic," Vujcic said, adding that despite the current issues, he believes that the economy then has the capacity to overcome it.

He believes that it is reasonable to expect a budget rebalance, as well for the CNB to accordingly adjust its economic growth projection, which it will do when the time comes.

"If the cycle of this epidemic is the same as we've seen in other countries, then we could see an economic recovery in the third quarter, but it depends a lot on the length of that cycle. The sooner it's over, the sooner the recovery will begin,'' Vujcic said.

He expects that the Croatian economy will see some structural changes, such as a likely increase in agricultural production, which he hopes will remain as such even after the coronavirus crisis passes, in the sense that it will increase Croatia's self-sufficiency in this regard.

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Monday, 13 January 2020

Zagrebacka Banka (Zaba) Pronounced Best Croatian Bank

As Poslovni Dnevnik writes on the 13th of January, 2020, UniCredit, of which Zagrebacka banka (Zaba) is a member, retains a leading position globally as the best bank in the field of trade and export financing according to the Euromoney Trade Finance 2020 survey.

According to Euromoney's Trade and Export Financing Survey for 2020, UniCredit is the best global provider of trade and export finance services and has been named the leading bank in the Consulting, Financing, Overall Performance and Products categories, as well as the best provider in Western Europe and Central and Eastern Europe (CEE).

It also ranked third globally in the "Market Leader" category, a category that combines market penetration, percentage of business and turnover data to create an overall ranking of the best banks for financing trade and exports.

UniCredit has won many first places in the rankings of individual countries, among them lies Croatia's Zagrebacka banka, which was named the best in the Market Leader and Best Service Provider categories.

The scope and depth of UniCredit's geographical coverage is further reflected in the fact that the bank is the market leader in Austria, Bosnia and Herzegovina, Bulgaria, the Czech Republic, Hungary, Italy, Romania, Russia, Serbia, Slovakia, and Turkey.

"Euromoney's recognition is yet another confirmation of Zagrebacka banka's leading market position in the area of ​​trade and export financing. It is the result of many years of tradition and experience, but also of the constant monitoring of market requirements and the creation of new business solutions for clients in this field. We'll continue to improve our services and in the coming period, we plan to further digitise traditional instruments of trade and export financing and new solutions in the area of ​​receivables and liquidity management,'' said Nikolaus Maximilian Linarić, Member of the Management Board of Zagrebacka banka.

The survey, which has been running for the ninth year in a row, compares the feedback gathered from over 7,000 corporate clients, convincingly showing UniCredit's product development and marketing expertise, superior customer service and a deep understanding of its key European markets.

"We're very proud of these results," said Richard Burton, UniCredit's Head of Corporate and Investment Banking.

"We strive to continually deliver our highest quality products and services to our customers, focusing on developing innovative solutions tailored to meet our customers' needs. This Euromoney survey recognises our continued efforts in these areas as we strive to support the real economy and build strong customer relationships, which is at the heart of everything we do, and we'd like to take this opportunity to thank our customers for their continued partnership and support,''

UniCredit continues to invest in trade and export finance innovations - most notably through its award-winning Trade Finance Gate customer portal - and remains committed to meeting its customers' needs by providing tailor-made trade and export financing solutions and working capital solutions.

Make sure to follow our dedicated lifestyle page for more on Zagrebacka banka and other banks which operate in Croatia.

Thursday, 6 June 2019

HT and Zagrebačka Banka Testing First Local Mobile Bank in Croatia

A brand new and far more efficient way of banking is almost ready for its release onto the market in Croatia, thanks to a partnership between Croatian Telecom (HT) and Zagrebačka banka.

As Poslovni Dnevnik/Bernard Ivezic writes on the 6th of June, 2019, with less than twenty days to go until the summer calendar officially begins, the first local mobile bank in the Republic of Croatia, developed by Croatian telecom (Hrvatski telekom) and Zagrebačka banka, is now ready for testing.

This service, called Telekom Banking, comes directly from the largest telecom and largest bank in Croatia, and the announcement is that it will be set up and ready online during the summer. Goran Lončarić, head of Telekom Banking at Croatian Telecom, confirmed that the mobile bank is now ready to be tested out.

"We're now launching the Telekom Banking pilot for friends and family, who will be the first to use the most advanced digital bank in Croatia," said Lončarić.

He also published a photo of his card featuring HT's (T), Zagrebačka banka's and Maestro's logos. Apparently, Deutsche Telekom has already reserved the domain where the service will be officially launched.

HT and Zagrebačka banka have both confirmed that the service is ready for public launch and that they're still working on testing mobile applications.

"Users are currently participating in the pilot project and we can say that we're very happy with their first reactions, and those services will become available during the summer," they stated from HT, adding that the application (app) will bring with it a whole host of other innovations.

HT's and Zagrebačka banka's partnership in Croatia is very similar to the one that the Romanian operator and a member of the DT group, Telekom Romania, realised on this market alongside one of the ten largest banks in Poland, Alior Bank. Their service can be found on the website and includes access to mobile and web banking by Poland's Alior Bank.

It's a very complex yet simple product, which includes current, savings and foreign currency accounts, as well as cards. For users who receive 1,000 kuna per month, it's all free.

It includes free and unlimited cash withdrawals from any ATM in the entire world, it includes both mobile and web banking, as well as the ability to view your last three transactions without having to go through the log in process.

The system also offers its users absolutely full control over PIN and locking their cards, and it supports both NFC and QR payments, as well as direct payments via email and mobile phone numbers. Lending possibilities are also on offer.

It is not yet known whether or not the exact same service which is offered by Telekom Romania and Alior bank will be offered here in Croatia by HT and Zagrebačka banka.

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Saturday, 25 May 2019

Privredna Banka Zagreb's Dinko Lucić Wins Prestigious Award

As Poslovni Dnevnik writes on the 25th of May, 2019, Dinko Lucić, CEO of Privredna banka Zagreb (PBZ), which is a member of the Intesa Sanpaolo Group, is the winner of the prestigious CEO Today's Europe Awards for 2019 for his remarkable contribution to the presentation of Privredna banka Zagreb in the Republic of Croatia.

Every year, CEO Today recognises and honours the most prestigious companies and their C-level executives in today's business world. The CEO Today's Europe Awards rewards the success, innovation and strategic vision of CEO's in numerous sectors and industries across Europe (the IT sector, telecommunications, pharmaceuticals, banking and finance, energy, mobile technology and communications, transportation services, etc.). CEO Today identifies the most successful, innovative, and future-oriented company leaders.

On the occasion of the announcement, Dinko Lucić, the CEO of PBZ, stated:

"I'm extremely proud of this truly special award, which is a historical and permanent record of recognition and success of our entire PBZ Group team. One of my basic beliefs, which has been confirmed during my long-standing managerial practice, is that the real difference is the people. I'm proud of our team and on this occasion, I'd like to thank all of our employees and also all of our clients for their constant efforts to be even better and to provide the full spectrum of financial services at the highest global level.''

The CEO Today Europe team has recognised a number of achievements by Mr. Lucić and PBZ in the past twelve months. The research team looks at the attitudes of many stakeholders, including investors, analysts, employees and media professionals around the world in order to properly create the basis for their annual award.

The results are then used as guidelines for considering and publishing the best management practices and critical performance factors, as well as the determination of eligibility based on achievements, which can be revenue growth and/or profit, a successful turnaround, good performance in difficult and complex times for the economy and industry, expanding onto new markets, leading market share(s), successful M&A integration, new products and services, and new business models and strategies.

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