Annual report 2004 (PDF, 4141 kB) - Unicredit Bank

During 2004, the Bank opened 14 new branches in Prague, Brno, Ostrava and other large
cities and thus increased the number of its outlets from 26 to 40. It implemented a new
organization structure of the retail banking segment, in particular, it split the operating
management of its distribution network from the creation of this segment strategy and from
the product development and controlling. We anticipate that this change will contribute to
more efficient management of the Bank's trading network and to creation of the target-based
segment strategy corresponding to the Bank's business objectives and current market
conditions.
In 2004, the Bank completed the integration of ŽB-Asset Management and ŽB-Trust into
Pioneer Investments Group, UniCredit Group's specialized division, which focuses on the
collective investment and assets management. The Bank also enlarged its investment products
portfolio by mutual funds from the Pioneer Investments group, which offer certificates
denominated in foreign currencies. We assume that close cooperation of Živnostenská banka,
a.s. and Pioneer Investments will continue also in future and enable Živnostenská banka to
exploit synergy effects arising from the merge of both companies.
During the year the Bank significantly increased its exposure in the residential property
financing. It granted more than 600 mortgage loans in the total volume exceeding CZK 1.3
billion (year-on -year increase by 40 per cent). It follows that mortgage loans appeared to be
most rapidly growing within the whole retail banking segment and will become one of the
main pillars of the Bank's future expansion in a segment of services to individuals.
Last year the Bank enlarged its offer of investment products by new structured EUROTOP
deposits, which products combine features of standard time deposits and investments into
shares and share index. The Bank complemented its portfolio of services for small business
clients by operating and investment loans with simple administration.
In direct banking channels Živnostenská banka enlarged operability and user comfort of
Netbanka (internet banking) which, jointly with MiniBanka (GSM Banking) and TeleBanka
(phone banking), provides a client with comfort of easy contact with his Bank. Direct banking
of Živnostenská banka is widely used and last year the number of its users increased by 44 per
cent.
Corporate Banking
In many aspects the year 2004 marked a turning point in the corporate banking segment. The
Bank successfully expanded in a segment of medium-size corporate clients, where it acquired
about 300 new corporate clients and achieved 16 per cent increase in revenues. The Bank had
also strengthened its position in a segment of large corporations.
Last year ŽB continued to implement a business model and risk management standards in
accord with UniCredito launched in 2003. Živnostenská banka reorganized its trade financing,
integrated documentary payments and guarantees, hitherto independent department, into a
newly created department. A corporate banking segment was enlarged by clients from the
financial institutions group, which were moved there from the investment banking division.
Trade finance activities were complemented by the factoring which had shortly become a
significant alternative of financing requested both by new and existing clients. The Bank
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