When Intesa Sanpaolo banker Stefano Burani was summoned to Milan by Ignacio Jaquotot, ISP Head of ISBD-Foreign Banks Division, in 2015 and offered an “exciting opportunity”, he knew “exciting” meant a challenge.
The offer was to move to Prague to take control of the city’s branch of Slovakian subsidiary VUB Banka, reporting to CEO Alexander Resch and strengthen it as a local centre of commercial banking.
“The business in Prague had good potential to grow. The Czech economy is strong – one of the best in Europe – growing at 2.3 per cent in 2016. And it’s an export-oriented country, which plays to my DNA,” says Burani, who has spent much of his career in international banking and has particular experience in trade finance.
We want to be niche. A bank that does what it does well and profitably, helping clients do their business in a fast and efficient way
Photo: Stefano Burani, Executive Director VUB Banka Intesa Sanpaolo Group, General Manager Prague
He arrived towards the end of 2015, taking the role of Executive Director and Country Manager, and quickly set about making sure – both in the market and within the ISP Group – that everyone knew VUB Prague was open for business.
“We need to hit very ambitious targets,” he admits.
Growth was to be organic and hiring was key. He did so locally, poaching people with international experience. Today the team numbers 18.
There was also work to be done refocusing operations. With the strong support of his CEO, Burani wanted to make VUB Prague as close to 100 per cent front office as he could. “I know you have to have some middle and back office, but it was important to be able to focus our resources on business, not administration,” he explains.
Much of the support work is being handed to VUB in Bratislava, the capital of Slovakia and home to VUB’s headquarters. Next came work on the catalogue of products he could offer clients.
VUB Prague concentrates on large commercial work. It does neither retail nor work for small or medium enterprises. Traditionally, it used “just” to lend money and issue plain-vanilla commercial guarantees.
The plan involved expanding trade finance, offering cash pooling while operating a novel electronic banking platform to speed up payments. It also plans to offer factoring, leasing and bond administration services in the future.
“Trade finance is my favourite, however. It’s absolutely what our banking group has been doing forever. We know how to handle this business and it’s a good revenue stream. With the Czech Republic being an export economy, I believe there are good opportunities. Especially in the more structured trade finance deals,” says Burani.
The plan worked and new business was signed. Already the unit has been co-operating with the Czech subsidiary of a Korean company as one of its main exporting banks and recently started working with the local state insurance company.
Some of that success he attributes to a unique combination of factors. Among them are the advantage of VUB’s good credit rating – A2/P-1 according to Moody’s – as well as the backing and experience of parent Intesa Sanpaolo, one of Europe’s strongest banks.
“Intesa Sanpaolo has great experience in trade finance thanks to its global business. It gives us a much better insight than some of our local rivals in assessing risks, even in ‘exotic’ countries, for example. We can evaluate and take on work that others really can’t. At the same time, we benefit from VUB’s excellent rating, allowing us also to compete on price,” he explains.
The Prague team works closely with Milan’s ISP-ISBD commercial department and Banca IMI, Intesa Sanpaolo’s investment banking arm. He’s confident that it will soon be possible to do other things, such as offering factoring in the Czech Republic or offering bonds agent and administration services to Czech issuers.
Such services are an obvious complement to the underwriting and private placement of bonds. It is a new line of business for the Prague office, which recently underwrote the first bond issued by a large domestic company.
The result: 2016 was a good year. Volumes were up 45 per cent since Burani joined and he is confident that the unit will hit this year’s target of 37 per cent growth. “I know it’s from a low base, but it shows the opportunity is there for us,” he says.
For Burani, there’s no appetite to become a full-service bank. Retail and SMEs might represent big volumes, but they are not VUB Prague’s focus.
“We want to be niche. A bank that does what it does well and profitably, helping clients do their business in a fast and efficient way,” he says.
He’s not worried that it will hold the business back in the rankings because it’s about being the best, not being the biggest. “Our focus is directly on the big domestic and multinational players.
“We now have really good, experienced staff who can offer a tailor-made service to business. It’s like private banking for corporates. It’s about providing a dedicated service with fast response times; about consistent approach with a professional attitude,” he says.
Burani is proud of what’s been achieved so far – making VUB Prague open for big business in the Czech Republic – and now he’s excited about the future. “This is an excellent opportunity. But there’s still plenty of hard work to do.”
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