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Erste Group

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Title: Erste Group  
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Erste Group

Erste Group Bank AG
Type Aktiengesellschaft
Traded as WBAG: EBS
Industry Financial services
Founded 2008 (1819 as the first Austrian savings banks)
Headquarters Vienna, Austria
Area served Central and Eastern Europe
Key people Andreas Treichl (CEO)
Products Retail and commercial banking, investment and private banking, asset management
Operating income €7,478.5 million (2011)
Total assets €199.9 billion (end 2013)
Total equity €12.0 billion (end 2011)
Employees 45,670 (end 2013)

Erste Group Bank AG is one of the largest financial services providers in Central and Eastern Europe and focuses on retail and SME banking. About 46,000 employees are serving clients in 2,800 branches in 7 countries (Austria, Czech Republic, Slovakia, Romania, Hungary, Croatia, Serbia).[1]

Erste Group was founded in 1819 as the first Austrian European Union.


  • History 1
    • 1819: Foundation of Austria’s first savings bank 1.1
    • 1938: During World War II 1.2
    • 1945: New development opportunities 1.3
    • Transfer to a joint-stock company 1.4
    • Merger with GiroCredit 1.5
    • Expansion in Central and Eastern Europe since 1997 1.6
    • Effects of the financial crisis 1.7
  • Erste Group organisation 2
    • Business organisation 2.1
    • Subsidiaries in Central and Eastern Europe 2.2
  • References 3
  • External links 4


1819: Foundation of Austria’s first savings bank

During the years of economic crisis in the wake of the Napoleonic War, Francis I, Emperor of Austria proposed the creation of a savings bank based on the German and English model. Johann Baptist Weber, a pastor in Leopoldstadt, pursued this idea. In 1819, he founded the “Verein der Ersten österreichischen Spar-Casse” (Association of Austrian first savings banks) and on 4 October 1819 “Die Erste oesterreichische Spar-Casse” (the first Austrian savings bank) opened its doors for business.[4] The bank shortly called "Erste österreichische", soon expanded throughout the realm.

1938: During World War II

After the Anschluss, the word Austria was removed from the bank name. The management therefore chose to remove the word from the market, calling the bank simply the "Spar-Casse", but to retain it in official documents.

1945: New development opportunities

After World War II, the reconstruction of the country brought new opportunities to the Erste österreichische, with the expansion of the private payment system, state-sponsored savings schemes, investment financing, exports support or credit to private institutions. The development of financial institutions able to solve problems for all customer categories progressed rapidly.

By the end of the 70s, structural changes in the banking sector like the lifting of restriction on affiliate founding, the Banking act or the termination of the inter-banking agreement on lending rates led to the emergence of a new situation, sparking a race between banks to attract competitors' customers.

Transfer to a joint-stock company

In 1993, the business operations of “DIE ERSTE oesterreichische Spar-Casse” were transferred to a public limited company pursuant to the 1986 Banking Act Amendment. In this procedure, all its banking operations were transferred to “DIE ERSTE österreichische Spar-Casse-Bank AG”, a newly founded subsidiary, which became the operational bank. The holding company changed its name to “DIE ERSTE österreichische Spar-Casse Anteilsverwaltungssparkasse (AVS)”.[3] In 2003, ERSTE Foundation evolved out of AVS being the main shareholder of Erste Group until today and fulfilling a philanthropic mission.

Merger with GiroCredit

As of 27 June 1997, Die Erste was merged with GiroCredit through the absorption of GiroCredit into Die Erste. Die Erste and AVS bought 51,1% of the stock from Anteilsverwaltungssparkasse Zentralsparkasse, which were added to the 26% stake already controlled. Through universal succession, Die Erste was subrogated into all the rights and obligations of GiroCredit. The merger was approved by the general shareholders’ meetings of Die Erste and GiroCredit on 21 Aug 1997 and became legally effective upon registration in the Company Register on 4 October 1997. At the same time, “DIE ERSTE österreichische Spar-Casse – Bank AG” was renamed “Erste Bank der Oesterreichischen Sparkassen AG”.[3]

Expansion in Central and Eastern Europe since 1997

In December 1997 Erste Bank went public[3] on the Vienna Stock Exchange with the strategy to expand its retail business model across potential EU-member states in Central and Eastern Europe. Since 1 October 2002, Erste Bank shares have also been traded on the Prague Stock Exchange and since 14 February 2008 on the Bucharest Stock Exchange.

Hungary: With the takeover of the Hungarian Mezöbank in 1998,[5] which had the fifth-biggest branch network in Hungary and was later renamed to Erste Bank Hungary Rt., Erste Bank secured a good starting position in Central and Eastern Europe. In 2003 Erste Group won the tender to buy 99.94% of Hungary’s Postabank, and merged it with Erste Bank Hungary in 2004. The new bank is the second largest retail bank in Hungary with 0.9 million clients and a market share by retail deposits of 8%.

Croatia: In 1999, together with Steiermärkische Bank und Sparkassen AG, Erste Bank successively acquired a majority stake (87%) in the three smaller Croatian banks Bjelovarska banka, Trgovacka banka and Cakovecka banka, and merged them to Erste & Steiermärkische banka. In 2002, Erste Group acquired an 85% stake in Riječka banka merging it with its existing operations and creating the number three bank in the Croatian market with 800,000 clients and a market share by retail deposits of almost 13%.

Czech Republic: In 2000 Erste Bank acquired a majority (52%) stake to 98% during 2002 and 2003.[6] Česká spořitelna is a leading retail bank in the Czech Republic, serving 5.3 million clients with a market share by retail deposits of almost 30%.

Slovakia: In 2001 Erste Bank acquired an 87% stake in Slovenská sporiteľňa, increasing it to 100% in 2005. Slovenská sporiteľňa is the largest bank in the country, serving 2.5 million clients with a market share by retail deposits of almost 28%.

Romania: In December 2005, Erste Group won the tender for 61.8825% stake in Banca Comercială Română (BCR), increasing it to 69.17% in 2006. BCR is the largest bank in Romania with 4.3 million clients and a market share by retail deposits of 23%.

Serbia: Erste Group acquired 83.3% of Novosadska banka in Serbia. In a strategic cooperation agreement with Steiermärkische Sparkasse, Erste Group holds today 80.49% of Erste Bank Serbia's shares. The bank has a market share by retail deposits below 3%.

Ukraine: Erste Bank acquired 100% of Bank Prestige in Ukraine, which was renamed Erste Bank Ukraine. The bank has a market share by retail deposits below 1%. Erste Bank Ukraine was sold in April 2013 to Fidobank. This transaction is consistent with Erste Group’s focus on customer business in the eastern part of the European Union. [7]

Effects of the financial crisis

In 2009 Erste received around EUR 2 billion in capital from the Austrian government.[8]

In October 2011 it said it expected a full year loss of up to EUR 1.1 billion, after making writedowns and provisions of EUR 1.6 billion. This would be its first loss since at least 1988. It said the writedowns were due to government intervention in Hungary, where it is forced to take losses on Swiss franc mortgages, and a slower than expected recovery in Romania. It will also delay a plan to repay some of the state aid received in 2009.[9] In August 2013 Erste Group Bank AG fully repaid the participation capital issued in 2009 in the amount of EUR 1.76 billion, whereof EUR 1.22 billion subscribed by the Republic of Austria and EUR 540 million subscribed by private investors. From 2009 to 2012 the Republic of Austria received annual dividend payments worth EUR 98 million from Erste Group and private investors received EUR 43 million. Altogether, including the pro rata dividend for 2013, which will be paid in June 2014 once the general shareholders’ meeting passes the respective resolution, the Republic of Austria will receive a total of EUR 448 million and private investors a total of EUR 198 million.[10]

Erste Group organisation

Business organisation

As of 9 August 2008, the newly founded holding company “Erste Group Bank AG” was separated from the Austrian business of “Erste Bank der oesterreichischen Sparkassen AG”.[11] The result was a clear separation of tasks between “Erste Group Bank AG”, which acts as a holding company, and its subsidiaries in each of the countries that concentrate fully on local customer business. The new company structure became necessary due to the expansion of Erste Bank-Group within Central and Eastern Europe.[12]

The holding company, named “Erste Group Bank AG” concentrates on the strategic steering function and provides the infrastructure for the local customer business in the individual markets. In addition, it is responsible for the operation of the business areas Global Markets and Group Corporate and Investment Banking.

Subsidiaries in Central and Eastern Europe

The holding company Erste Group Bank AG operates local banks in eight countries in Central and Eastern Europe:

  • Austria: Erste Bank der oesterreichischen Sparkassen AG
  • Bosnia-Herzegovina: Sparkasse BH
  • Czech Republic: Česká spořitelna a.s.
  • Slovakia: Slovenská sporiteľňa
  • Hungary: Erste Bank Hungary Zrt.
  • Croatia: Erste & Steiermärkische Bank d.d.
  • Serbia: Erste Bank Novi Sad
  • Romania: Banca Comerciala Romana
  • Montenegro: Erste Bank AD Podgorica
  • Ukraine: Erste Bank Ukraine AT (until the midst of 2013)[13]


  1. ^ "Annual Report 2010 2010". Erste Group Bank. Retrieved 2011-03-04. 
  2. ^ Professor Dr. Brusatti, Alois und DDr. Marginter,Peter. Wien, am Graben 21. R. Kiesel, 1969. p. 33.
  3. ^ a b c d Rapp, Christian und Rapp-Wimberger, Nadia. Arbeite, Sammle, Vermehre.. Verlag Christian Brandstätter, 2005. p. 132.
  4. ^ Thausing, Friedrich. Hundert Jahre Sparkasse. Carl Gerold's Sohn, 1919. p. 18.
  5. ^ Rapp, Christian und Rapp-Wimberger, Nadia. Arbeite, Sammle, Vermehre.. Verlag Christian Brandstätter, 2005. p. 135.
  6. ^ Rapp, Christian und Rapp-Wimberger, Nadia. Arbeite, Sammle, Vermehre.. Verlag Christian Brandstätter, 2005. p. 138.
  7. ^ Erste Group History
  8. ^ UPDATE 1-Erste says sold 540 mln eur capital to investors, retrieved 2011-10-11 
  9. ^ Erste Slumps as Hungary, Romania Trigger $1.1 Billion Loss, retrieved 2011-10-11 
  10. ^ Erste Group News
  11. ^ "About Erste Group Bank AG". Retrieved 2010-10-11. 
  12. ^ "New company organisation". Retrieved 2010-10-11. 
  13. ^ Економічна правда (20 грудня 2012). ""Фідобанк" Адаріча купує "Ерсте Банк"" (HTML). Retrieved 2013-02-18. 

External links

  • Official website
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