Sberbank CZ: Might happen that our grandchildren will see the banknotes only in a museum
Banks.eu continues a series of interviews with top managers of European banks to tell all the details of the credit institutions’ activity in Europe and their future plans. This time Jiri Antos, a member of the of Sberbank CZ board, is the interlocutor of the portal. Antos spoke about the core values of the Czech "daughter" of the Russian Sberbank; he told how to attract customers in this challenging times; he explained what to bet on when doing business; finally he commented on the key trends in the banking market in the Czech Republic and on the prospects of the country in case of total cash rejection.
- What attracted you in Sberbank? How is it different from other banks represented in the Czech Republic? Where did you work before Sberbank?
- Sberbank was a wonderful opportunity to be part of it – one of the biggest European lender, one of the currently most admirable European bank had started its operations on the Czech market. Quite appealing opportunity! Sberbank CZ is a middle size bank on the market, but part of something big and successful. Sberbank itself operates on 22 markets worldwide and become global financial institution. The size of the group gives us confidence to offer excellent services to our clients. Here on Czech market we are still at the beginning, basically building the bank from the scratch based on Volksbank heritage.
- Sberbank operates in Czech Republic since 2012 – what has changed during this time in the activities of the bank? How did bank develop its business in Czech Republic – what was the start and what are the results now?
- Volksbank CZ was small bank with less than 50 000 customers, focused mainly on mortgages and small and medium enterprise financing. Since the acquisition, Sberbank CZ covers all segments – private individuals, SME and corporate clients. New services and products had been launched in relatively short period of time. We have basically doubled the bank, servicing currently over 100 000 customers - still growing across all segments and all products. We have built new branches with very nice and welcoming design, introduced online channels for better offer of our service. Comfort of using our services, transparency, customer satisfaction, trust and fairness are the key values for us.
- How does Sberbank CZ attract customers in the period of low interest rates on loans and deposits?
- As I said before – fairness, comfort, transparences are the key values. Even our product has it in their name – “fair account”, “fair loan”. The product conditions, e.g. price, reflects depth of customer relationship with the bank. It works simply - the more products / services customer use, the better conditions have. Just to name a few - saving accounts, personal loan and mortgage are products with one of the best offers on the market. Small entrepreneurs are very valuable to us as well – many new products on deposits and loans sides were introduced.
- What is your prognosis – will the average mortgage rates in the country begin to rise fast until the end of the year? When will they start to grow significantly and will they at all? What consequences will that bring to customers and banks (that are giving a record number of mortgage loans this year)?
- In my opinion, the rates will be more likely flat or oscillate around current level. The market is over liquid, competition is strong and economy grows. The banks have to provide more loans to utilize all the deposits they have. On the other hand, the regulator is more aware of mortgage boom and tries to imply certain measures to regulate the market, e.g. limitation on 100% “loan to value” mortgage.
- How does Sberbank CZ attract customers - both individuals and business? What is the strategy of the bank to attract customers? Does bank use the connection to Russian Sberbank and how?
- Excellent services plus overall customer comfort with using our bank are the key long term lasting competitive edges we want to own. Simple and quick process, low bureaucracy, no hidden fees, and mainly human touch. We have been awarded 3 times in a row among top 3 most friendly banks on the market. Nice proof that customer is always on the 1st place!
Our customers can only benefit from our connection to Russia – for example, we offer very quick payment system (with 1 day max) or very unique products like “cross boarder mortgage” – mortgage for nonresidents with their income in Russia.
- On which customers does bank bet in its business - on Czechs or on Russian-speaking immigrants? Why?
- We are Czech bank, operating in the Czech Republic, so we are logically focused on Czech market, serving the most Czech customers. This is our primary focus.
Nevertheless, we also serve sizeable population of Russian speaking customers – which is again quite logical, given our brand and natural connections. As I said before, for this segment we have specific services and products to better serve their needs. On some branches we are able to provide our services in their native language – which is very welcomed! Also our web page is available in Russian language as well.
- What is the difference between working with Russian-speaking clients and working with the Czechs?
- Well, yes, one might find some differences, but there are not many. One of the feature the Russian speaking customers appreciate a lot is that they can come (especially in Prague, Karlovy Vary or Brno branches) to our branch or make a call to our call center in their native language. Out of 29 branches, majority has a personal/s speaking in Russian.
The overall needs are basically the same. Russian speaking customers seeking more services linked to payment transactions to/from Russia.
- How the bank is going to act, if the "big" Czech banks raise fees for the use of their ATMs?
- Nothing is clear at the moment. If they introduce it, we will react. Our customers can benefit with our partnership with CSOB and access to their ATM network, which is one of the biggest on the market.
- What digital services does the bank offer – is Sberbank CZ going to develop this segment? Does it motivate clients to non-cash payments and how?
- It is just natural move. More and more services are being shifted to digital channels, more and more customers are accustomed to deal with the bank remotely. Our customers can deal with the Sberbank via internet banking or our mobile application. Some products can be even purchased online via our eShop without branch visit. Next year we are going to introduce completely new internet banking, launching brand new mobile application, and also brand new web page with eShop – online gate to purchase wider spectrum of banking products. Almost everything what is done at branch is available online. In key foreign languages (Czech, English and Russian).
- What are in your opinion the main trends in the banking market in the Czech Republic and in the world?
- Golden question, indeed. Some things are more obvious than others. Digitalization of banking services will continue in wider scope, customers will have various options how to deal with the bank. The trend is there already. New, tech based financial institutions will come to the market and change it. Financial market regulation is going to be tougher than we see today. Security of online channels would be a big challenge as well. We can see fully automated branches without staff, ATMs where plastic cards will be replaced by biometric identification …
- Czech Republic is the leader in the number of contactless payments in Europe. In your opinion, what are the prospects for the Czech Republic in complete abandonment of cash?
- The penetration of contactless in one of the biggest in Europe. Customers got used to it, almost every shop accepts such payments. I see Czech market is very receptive to innovations, customers early adopt any way to transact easier and quicker way.
Relating to non-existence of cash. Once that day will come. However, I don’t think it will happen in next 10 years. Might happen that our grandchildren will see the banknotes only in a museum… There is strong habit to use cash, and even there is more and more non-cash transaction, the amount of cash (banknotes, coins) is on record heights.
- Many banks in the Czech Republic this year offered customers a free bank account. Does Sberbank have such an offer? What is the average cost of an account in Sberbank today?
- Free accounts are new reality for today. Of course, we offer such accounts as well. Just use actively your account with us and it is for free.
- Czech Republic is one of the few countries where the number of cards MasterCard is higher than the number of cards Visa. In your opinion, why is it so? Does MasterCard offer better conditions for Czech banks?
- Simple question, but not an easy answer. Might be that MasterCard had started a bit sooner than Visa on local market, so has stronger relationship. Many customers do not see any difference, some ask for one or other, some want to have both in their wallets.
- Many Czech banks often conduct marketing campaigns in which offer customers discounts and gifts. How does Sberbank encourage its customers? What is the most successful marketing campaign of Sberbank?
- We consider ourselves more as a start-up on local market rather than fully established bank. As every newcomer, the brand building is one of our key priorities. We are promoting various products on various channels, most visible would be personal loans, saving accounts and loans for entrepreneurs. We believe that quality of the service, fair product pricing, accessibility are key long lasting factors we are going to promote even more. There is no better gift that a complete satisfaction of your needs when dealing with us …
- What is the main goal of Sberbank in the Czech Republic for the next 5 years? How does the bank see itself in the future and what steps the bank is planning to take to achieve its goals?
- Sberbank CZ is a long term project. We are middle-size bank (actually # 8 on the market), our ambition is to be among Top 5 banks. We are serving all customer customers segments, from private individuals to multinational corporations. Let me talk more about retail, private individuals. We are relatively small in physical distribution (29 branches as we speak) – even though we still plan to open a few more, the main focus is on digitalization. Mobile banking would be one of the key competitive edges of tomorrow. This is logical move – we own more and more mobile devices, penetration of smartphones is constantly increasing. Current young generation does not know other phones than smart ones! We’ve got used to use them for almost everything – buying goods, book tickets, hotels, holiday packages, ordering a taxi, chatting with friends. To keep the excellent quality of the service, we have to be where our customers are – in this terms virtually in their pockets … J. But it is not only about the nice app in your phone. We are already living in the era where machines talk to other machines … your phone with ATM, self-service zones etc. You have asked about contactless cards before …. but why to have plastic contactless card when you can have an app? Much better, much simplier, more convenient. Obviously, the security will be (or already is) a big challenge here. It will always be the tradeoff between the convenience and high security.
This is our way and this is our future.
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