Jelena Galić, AIK Bank CEO

The banking sector in Serbia is most in line with EU regulations, compared to other areas of business in our country, which in the further process of harmonisation with European regulations can also contribute to a faster alignment to EU directives and standards in other sectors, reveals Ms Galić for CorD

With the takeover of Gorenjska Bank slightly over a year ago, AIK Bank became the first bank from Serbia to enter the European Union market. What were your expectations and were they met? 

AIK Bank’s focus is on business development, the expansion of its market presence and innovation, and in accordance with that, among other things, the process of taking over Slovenia’s Gorenjska Bank has also been concluded successfully. By strengthening its position in the region, AIK Bank has strengthened its position and gained the opportunity, together with Gorenjska Bank, to offer customers a quality service in the European Union. With this takeover, AIK Bank became the first bank from Serbia to enter the European Union market, which testifies to the strength and sustainable development of the foundations upon which it bases its operations. We decided on Gorenjska Bank because it is stable, with a good capital base, locally recognisable and provides good foundations for further development across the entire region and, together with AIK Bank, on the international market. In short, these are our expectations and I’m sure we’re on the right path to realising them.

We assume that the goal is for AIK Bank to gradually position itself as one of the leading players on the banking market in this part of Europe. Are we off the mark?

As I’ve already stated, we are the first bank from Serbia to enter the European Union market and our goal is indeed to position ourselves as one of the leading banks of the banking market in this part of Europe. I’m extremely proud that, during this takeover process, the bank has shown its capacity to respond to the complex and demanding procedures of the European Central Bank, the Bank of Slovenia and the National Bank of Serbia, which encourages us to continue implementing our strategy of further expansion in this part of Europe, as a financially strong and credible banking group.

I have the impression that clients are satisfied and that the banking sector was really up to the task during the state of emergency

Thanks to the consolidation of the banking sector that has started, the possibility of financing large regional development projects has increased. Would that contribute to connecting economies, expanding markets, strengthening competitiveness and accelerating the region’s economic development?

All the markets of our region are small when viewed individually. If the regional market does not unite, we will all remain without the benefits it can bring. Here I don’t mean only the banking sector, but rather economic cooperation in total. In that sense, the consolidation of the banking sector in the region contributes to the development and expansion of regional cooperation between the economies of different countries, with which the market expands, thus accelerating the economic development of the entire region. Compared to other areas of business in our country, the banking sector in Serbia is most in line with EU regulations which in the further process of harmonisation with European regulations can also contribute to a faster alignment to EU directives and standards in other sectors.

Speaking at the third online conference entitled “Business in Challenging Times”, you discussed the good organisation of banks under the conditions of the pandemic. Do you still think that your industry responded quickly to all requests and expectations of clients?

Solidarity and mutual support are most important in times of crisis. In that sense, the banks reacted responsibly and supported all measures in the direction of preserving financial stability and supporting the real sector of the economy. Moreover, we improved and strengthened online channels, in order for as many of our clients as possible to be able to use as many services as possible through e-banking and m-banking.

Likewise, banks enabled their networks to be available to all clients, in order for the payment system to function unhindered, and especially for us to organise all pensioners receiving their pensions on time. In that sense, I think that clients are satisfied and that the banking sector was really up to the task during the state of emergency.

How do you rate the set of economic measures introduced by the state to help both citizens and the economy recover as easily as possible from the financial hit brought by the pandemic?

The Government of the Republic of Serbia’s set of economic measures aimed at minimising the negative consequences of the Covid-19 pandemic arrived at the right time. I believe the package of measures adopted encompassed the most important aspects of support for the economy and I firmly believe it will fulfil its basic aims related to preserving jobs and provide a chance for the survival of primarily micro, small and medium-sized enterprises, which are extremely vulnerable at present. When it comes to the third set of economic measures, I expect it will reduce external factors, such as the decline in demand and interruptions to supply chains and their consequences, while the fall in social product will remain within expected limits.

Our goal is to upgrade our traditional banking with digital banking, thereby creating a complete offer of financial products and services available to all

How many debtors have decided to opted to make use of the moratorium on loan repayments? Do you expect an increase in NPLs?

Immediately at the beginning of the emergency health situation in the country, the NBS brought the decision to introduce a three-month moratorium on the repayment of all loans. The procedure has been simplified to the maximum, so at the level of the entire banking sector, in the domain of retail banking, about 90 per cent of users have been under a moratorium since 31st March, while in the domain of corporate banking that share is a slightly smaller.

In addition to this, banks have also supported the real sector of the economy through the guarantee scheme for liquidity and working capital loans, so in total sums we’re talking about two billion euros with which banks are, practically, helping the economy and citizens to more easily overcome the state of emergency caused by the pandemic. In that sense, we shouldn’t expect a large growth of NPLs in the coming period, and considering the experience from the previous crisis of 2008, banks have in the meantime equipped themselves well to respond to “external shocks” in a timely and adequate manner.

Although your bank has taken serious strides into the world of digitalisation and new technologies, you constantly offer additional innovations to clients and the market. What did your plans include in total for this year and will you postpone any of that?

Through the building of a strong digital platform, we want our clients to see AIK Bank as a personal bank that understands their individual needs and provides them with the desired services, regardless of time and location. Our goal is to upgrade our successful traditional banking with digital banking, thereby creating a complete offer of financial products and services, accessible to all and tailored to individual needs.

We want to use online banking to make it easier for our clients to carry out all banking transactions, the backbone of which is mobile banking, to which the complete offer of the bank is transferred. Our plans include various online banking products, both in the segment of retail operations and in the segment of operations with small and medium-sized enterprises, and at this juncture we estimate that we will make them available to our clients during this year, according to initially planned dynamics.