Retail Banking in CEE: Exploiting the Potential of ... - Roland Berger

SUMMARY OF KEY FINDINGS
7
REGIONAL CENTERS' APPROACHES IN CEE
An essential trend is that more and more regional head offices increase the control of
local banks as regards the micro segment. When this study was being prepared, most of
the major CEE banks had at least a standardized reporting form to grant comparable,
transparent and traceable micro operations. In addition, a few banking groups showed
a strong head-office competence in micro business. They elaborated their own best
practice model and now these banks are ready to roll it out in the CEE countries.
On CEE level, standardized reporting
has become usual, while bestpractice
model elaborations and
roll-outs are still rare
The study interviews clearly showed: although the majority of banks want to grow in
the micro segment, the level of strategy elaboration together with the commitment and
ability to implement varies significantly by bank and by country. For example in Russia,
Ukraine and Belarus, the large corporate segment still generates enough business
potential with moderate risk to fulfill banks' growth demand. Therefore for them, the
fragmented, per-deal lower business volume and more risky micro businesses are too
problematic to focus on.
At the same time, there are best-practice models in CEE banks that are focused on
micros, have the necessary level detailing of their micro strategy and a proper scoring
model and apply cross-segment offerings. These strategies, however, are quite fresh,
they were implemented recently or are still in the process of implementation. Therefore
it is difficult to compare them from a proven success and result point of view.
POSITIONING STRATEGIES
All the interviewed CEE banks do not intend to start a price war and to win clients
with aggressively low prices. They prefer to differentiate themselves via high-quality
service compared to the competitors' ones, often formulated as "being close to the customers";
and the majority believes that others do not exactly understand the banking
needs of micros. Products are considered to be "easy to copy" and therefore the product
focus is not perceived to be a winning strategy.
CURRENTLY APPLIED SEGMENTATION
The targeted sub-segment focus is not spread yet. Interested banks are rather focusing
on healthcare related professions (pharmacists, medical doctors, dentists and veterinary
doctors) and lawyers. However, there is room for improvement considering the country-specific
market opportunities. For example, in Croatia it is common to focus on the
HoReCa segment which has no real micro priority in other countries.
Banks want to differentiate and
compete with their service level
assuming that others do not
sufficiently understand micros'
specialties
There are popular sub-segments
targeted by most of the banks
having micro segmentation – above
all in the healthcare sector