The acquisition wave that shed Serbia's banking market on the one hand is quite expected, and on the other hand completely unexpected.
It is expected that experts say 29 banks are too much for a country whose gross domestic product last year was less than 37 million euros. But it is unexpected because previously foreign banks have already been purchased by existing domestic banks and, lately, foreign-owned banks are buying domestic entrepreneurs.
The first move was withdrawn by Miodrag Kostic, who in the meantime became the 100-year AIK Bank owner to take over the Alpha Bank.
Last year, AIK Bank was the first in Serbia for a net profit of 118 million euros, the fourth for one billion euros and the sixth for a total of approved loans of almost 1.8 million euros, informs the agency Beta .
The new players in this market are Andrej Jovanovic and Bojan Milovanovic, who first bought the Serbian subsidiary of Nova creditite banka Maribor, changed his name to Banco Directo and then "bought" Pireus and Findomestik Bank.
Before joining Piraeus, by the end of 2017, the Direct Bank was the tenth for a profit of 16 million euros and the sixteenth place after participating in the total assets of 0.8 percent (the percentage of Pireus Bank was of 1.5 percent) and in terms of capital from 33 million euros, while the capital of Pireus Bank is three times the largest, 108 million euros.
Many are probably no longer remembering that more than 80 banks operated in Serbia two decades ago, almost all with national capital. Already in 2004 its number has fallen to 47, and this trend has continued, although meanwhile, new "players", such as Bank of Tea or Mira Bank of the United Arab Emirates, reached the Serbian market.
In professional circles, there is almost a consensus that the strengthening of the banking market in Serbia is still to come, because banks with a market share of less than two percent will hardly survive in the toughest game.
At present, there are up to 14 banks with a market share of less than 1.5 percent. All of them approved only 7.5% of total loans, while the participation of the six largest banks, Intesa, Komercijalna banka, Unnikredit, Société Générale, Raiffeisen and AIK Banka were eight times larger: 62.2%.
Finance Minister Sinisa Mali has already announced that the state plans to sell its stake in Jubmes Bank later this year, next year and in Komercijalna, and the strategy is prepared for the Serbian bank. In addition, for months, the public speculated on who could buy the Société Générale Bank because this French group withdrew from the Croatian market.
In favor of this thesis, there is also a low degree of concentration in the Serbian market. In Croatia, the four largest banks account for almost 70% of the total assets, and in Serbia the four largest banks approved nearly 47% of all loans. Therefore, Ivan Nikolic, a member of the Board of Governors of the National Bank of Serbia, believes that consolidation is not only expected but also desirable. "This is a positive process, as it will increase the performance and strengthen competition among banks, and this will bring benefits to customers because they will have more loans," said Nikolic, who recently informed BETA that he does not see the problem in the fact that the banks bought domestic investors. Previously, says the board member of NBS, "experience has shown that foreign owners are not always successful."