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September 7th, 2008
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Banking & Finance Headlines

February 13th, 2008 | Current Issue

Brokered returns
Firms sign record number of small investors in face of market turmoil

Local businesses becoming more 'European'
Companies dreaming big adopt EU's Societas Europaea format

BRIEFS


RATES As expected, the Czech National Bank (ČNB) voted to raise interest rates 0.25 percentage points, to 3.75 percent, Feb. 7. The move was made to help keep inflationary pressure in check. Interest rates have increased 2 percentage points since late 2005. The chance of further rate increases remains uncertain due to the strong crown.

INGOSSTRAKH An arbitration court in Moscow ruled that the 38 percent share PPF Investments (PPFI) holds in Russian insurer Ingosstrakh was legally obtained, Mladá fronta Dnes reported Feb. 12. PPFI is mired in a dispute with Ingosstrakh’s primary shareholder, oligarch Oleg Deripaska, who has tried to reduce PPFI’s control by increasing Ingosstrakh’s capital.
BANKERS President Vacláv Klaus said he opposes the state’s current method of appointing members to the ČNB’s governing board. Klaus made his remarks in a meeting with the opposition Social Democrats Feb. 6. The president has sole discretion in assigning and recalling board members — a power first granted to curb Klaus’ control of the bank when he served as prime minister, he said.
BOARD In other ČNB news, Klaus confirmed Feb. 5 that Jiří Weigl, head of the president’s office, and Vladimír Kolman, the ČNB’s head of human resources, are candidates to join the bank’s governing board. A spot on the board will open at the end of February, when the second six-year term of Deputy Governor Luděk Niedermayer expires.
FUNDS The strong crown has cost the Czech Republic some 80 billion Kč ($4.6 billion) in funding from the European Union, Právo reported Feb. 11. From 2007 to 2013, the country is set to receive 26.7 billion euros in EU funding. The crown has appreciated 10 percent against the euro since that deal was signed in December 2005, and the government has done little to hedge against the rise.
GROWTH The banking sector will likely grow by up to 20 percent this year despite the overall expected slowdown in the economy, said Jiří Kunert, president of the Czech Banking Association and CEO of UniCredit, in an interview with the Czech News Agency Feb. 11. Kunert did say he expects a slowdown in the mortgage market and did not rule out further mergers in the sector.
SCRAPPED The PPF Group has called off its plans to set up a joint banking venture in Russia with the bank Nomos, Reuters reported Feb. 5. PPF is one the largest players on Russia’s consumer finance market, owning Home Credit and Finance Bank. PPF currently controls 16.15 percent of Nomos.
LISTED The Prague Stock Exchange (BCPP) is negotiating with several large foreign firms to offer dual listings of their stocks in Prague, said the bourse’s CEO Petr Koblic Feb. 5. The Vienna Insurance Group began trading on the BCPP that same day, becoming the fourth dual listing on the bourse, joining Erste Bank, Central European Media Enterprises and Orco.

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