Focusing on consolidating sustainability, expanding digital channels, and staff development programs, Garanti BBVA Romania is in a favorable position to build on last year’s positive results. In an interview with Business Arena, CEO Mustafa Tiftikcioğlu talks about the opportunities and challenges facing the bank and the industry as a whole in these times of change.
By Cristian Cojanu
Garanti BBVA Romania has listed sustainability among its strategic priorities. What specific measures have been put into place in order
to ensure business sustainability in the current context?
Sustainability is one of our five strategic priorities, in line with our assumed role of significant contributor to the inclusive, environment caring, economic, and social development. As a bank, we can act as a financier for a greener economy, but also share our knowledge, foster cooperation with external stakeholders, and use our influence in society to increase awareness and achieve results in promoting sustainable development.
As a responsible economic actor, we incorporate sustainability in our daily operations (for example applying in our offices efficient, electricity use, selective waste collection and a hybrid work model – all measures aimed at reducing our carbon footprint).
We have developed our product offering by adding financial products that contribute to protecting the environment, such as Casa Eco, a green loan granted to individuals for acquiring green residential units certified as such by Romania Green Building Council. We permanently adapt our credit risk tools for assessing and mitigating ESG risks in companies lending and always encourage sustainable financings like we started for green residential projects.
Our banking offer is complemented with a wide range of green consumer finance products for electrical vehicles, solar panels or other energy efficient heating solutions. This is why we consider that the banking sector can be a driver and an enabler for the green transition and inclusive, long-term growth.
What has changed in the banking system due to the pandemic and war in Ukraine? What are the expected long-term effects?
Romania’s economy has overcome the crisis caused by the COVID-19 pandemic, primarily due to entering the period in a good shape, and was also helped by the measures adopted by the authorities. During this period, the banks had a good collaboration with the public authorities, and facilitated access to finance for the population, thus supporting the recovery of the economy.
In addition, the pandemic led to important changes in the banking system, like the acceleration of digitalization. In the long term, we are sure that technological development will continue, and more and more banking operations will be performed online. Apart from the requirements during the pandemic period, there is increasing demand from customers to use digital channels for convenience and fast solutions to their needs. In this context, we will continue to invest in our digital channels, to continue to be a solid partner for our clients. To conclude, the pandemic encouraged migration to remote solutions, the adoption of remote work, and the orientation towards sustainability.
From the macroeconomic and financial risks perspective, the prudential and financial position of Romania’s banking system is better than that of EU averages, in terms of capital adequacy, provision coverage, profitability, and loan to deposit ratios, with favorable developments in 2021 and Q1 2022. The war in Ukraine has had a limited impact until now, indirect effects like inflation, energy sector problems, supply chain disruptions, and interest rate hikes may build up to create negative effects both for individuals and for companies. Still, the banking system is robust to navigate through this undesirable and unfortunate geopolitical and macro environment.
What are the main investment and development projects designed to increase Garanti BBVA’s market competitiveness in 2022?
This year, we will focus a lot on investments that can make our group even more sustainable, investments that will be directed both to the inside of the company, as well as to the products and services that we have in the pipeline. We have initiated a series of actions meant to bring us closer to our goal of becoming a green organization, and our efforts to help protect nature will continue from now on.
Among our priorities in terms of budgeted investments is of course the professional development of our teams. We want with us banking specialists who are financial advisers for our clients and who can always come up with a customized solution for each individual or company.
We have completed developments to decrease the time-to-money in our loan processes and will continue to invest and develop our digital services, as we see that during uncertain times, but not only, our clients prefer our easy-to-use and safe digital channels.
You can read the entire interview in Business Arena’s September print edition.