Volksbank Malta is currently promoting what is expected to be a very interesting conference to be held later on this month mainly aimed at local companies seeking expansion abroad, especially to East European countries.
Volksbank came to Malta in 1995 and is one of the foreign banks which has given Malta a vote of confidence by staying on even after the old offshore regime was reformed into an onshore one.
The regulatory overhaul meant that Volksbank had to change the way it did business in Malta and it took up the challenge, moving from being primarily an operator in international participations to concentrating more on local business, obtaining an onshore banking licence in 2002.
Volksbank, therefore, became more involved in the local market and looks to servicing small- and medium-sized business, what Herbert Skok, the managing director of the local operation, effectively described in a recent meeting as "being any good business employing between three employees and a thousand". The group prides itself, and continually emphasises, its sensitivity to customer needs.
In fact, it is not only the local bank which aims its services at SMEs but the parent group itself in Austria, The Austrian Volksbanken Group, at the heart of which is the main company Osterreichische Volksbanken AG.
The Volksbanken Group is rooted in the cooperative movement and its individual units are an intimate part of the regions in which they originated. The Group has a network of 750 branches in 14 countries and is active in real estate finance including building societies, insurance, leasing, investment funds, as well as traditional banking services. The Group has a number of foreign subsidiaries including Volksbank units in Malta, the Czech Republic, Slovakia, Hungary, Slovenia, Romania, Croatia and a branch in Verona, Italy. A branch in Bulgaria is being planned.
The group leveraged its international network by joining the Confederation Internationale des Banques Populaires (CIBP), which is based in Paris and Brussels, which brings together more than 30,000 branches. Volksbank is also the main shareholder, with a 45 per cent interest, in Investkredit AG, which is active in corporate finance.
Volksbank Malta Ltd is part of the Volksbank Malta Group and has two subsidiary entities, namely OVAG Finance Ltd, which was incorporated in Jersey in 2004 to participate in structured finance transactions, and VB Finance Ltd, which provides IT services to the bank and other Austrian banks operating in Malta.
In 2004, Volksbank Malta Group had net interest income of €7.6 million and profit after tax of €5.1 million. Deposits amount to €484 million and loans to €565 million. Shareholders' funds amount to €173 million.
The conference, which is being held in Malta on April 22, promises to be very informative and seeks to throw light on developments in Central and Eastern Europe, government incentives, tax arrangements, and strategies which might be adopted to set up or expand business in these countries.
There will be speakers from the local bank, from Volksbank International, Volksbank Romania, Volksbank Czech Republic as well as from Credito Siciliano, a partner bank. A corporate tax services advisor from KPMG will discuss the various tax implications involved in such European business.
According to the Volksbanken Group: "The concept of cooperative banking was developed more than 150 years ago and has remained up-to-date and vigorous ever since that time. The central idea is that of giving assistance to clients - thus human beings are placed at the centre of all activities and customers are regarded as partners."
pva@onvol.net
Paul V. Azzopardi is managing director of Azzopardi Investment Management Ltd (www.azzopardi.com) which is licensed by the MFSA to provide investment services, including stockbroking. Mr Azzopardi or related parties, including the company, and their clients, are likely to have an interest in securities mentioned. This article is only meant to provide information, which the writer believes to be accurate at the time of writing, and is not intended to give investment advice and its contents should not be construed as such. Readers are requested to seek professional financial advice tailored to their own personal circumstances.