Hungary's OTP completes Croat buy, sees more

OTP, Hungary's biggest bank, plans to focus next on gaining a foothold in Serbia and expanding its presence in Romania but might also make further purchases in Croatia to meet its plan of doubling Nova Banka's market share by 2010, OTP Chairman and Chief Executive Sandor Csanyi said.

OTP, the second largest publicly traded central European firm, plans to raise Nova Banka's market share to over 10 percent from just above 5 percent within five years and expects to achieve a return on equity of 20 percent by 2010, Csanyi told a news conference.

"We don't see any major banks on the market but there may be some opportunities with smaller banks," Csanyi said. "We won't be content with Nova Banka's market share of just above five percent but the problem is that this isn't an underbanked, weak market," Csanyi added.

OTP plans to open between 20 and 30 branches within three years to complement Nova Banka's 90 branches and plans to expand is presence in Zagreb and the Adriatic coast.

It will also enter the lease finance and fund management markets but an entry into the insurance market is not imminent, Csanyi said.

But OTP's main focus in expansion will be on Serbia and a Romania.

"These are our two main targets," Csanyi said.

"We had wanted to go into Serbia for a long time and we think we can finally realise this plan this year," Csanyi said.

OTP earlier failed to win Jubanka, which was bought by Greece's Alpha Bank.

OTP will also bid in the privatisation of Romania's fourth largest bank, CEC, expected in the first half of this year.

"The problem with Romania is that the market is doing really well and it's very difficult to make an appropriate return at a price to book value ratio above three," Csanyi added.

Csanyi declined to answer questions about OTP's plans to buy a Turkish bank and said it is looking at possible Turkish acquisitions the same way it looks at every opportunity in the region.

Source: Reuters