Erste Group Bank could decide by end of this year to sell its loss-making Ukrainian unit
2012-10-09 11:51:16
Austria's Erste Group Bank could decide by the end of this year to sell its loss-making Ukrainian unit, Reuters has reported, citing Erste Bank (Ukraine) spokeswoman Yelena Pavlovska.
"Ukraine has not lived up to (our) expectations of economic development and the group is considering the question of whether it should continue working on the Ukrainian market," she said.
Pavlovska said that a decision could be made by the end of this year. "We are analyzing the market now, the option of selling the bank is being considered but the option of staying in the market is being considered as well," Pavlovska said.
According to Reuters, Erste bought a small bank in Ukraine in 2006 and as of July 1, 2012 it had assets of UAH 9.8 billion (USD 1.2 billion), making it the 22nd largest lender among Ukraine's 176 banks. Like many other Ukrainian banks, Erste has struggled since the 2008-2009 crisis when the Ukrainian hryvnia fell 60 percent against the dollar. The bank has reported losses since 2010.
Several other banks from Western Europe have already left Ukraine or are reducing local exposure, Reuters said. Sweden's SEB and Swedbank have closed down retail operations and Germany's Commerzbank is selling its local subsidiary Forum to Ukrainian businessmen, reads the article.