This year’s BNR-ASE conference provided a platform for prominent figures in the banking industry to share insights on the strategic directions and challenges facing banks in Romania. For the most part, industry leaders highlighted the inevitable trend of banking system consolidation. However, this consolidation, or better said, the pace of this change, might slow down compared to previous years.
Omer Tetik, CEO of Banca Transilvania commented on the difficulty of integrating smaller banks due to the high operational and merger costs:
When we were a bank with an 8% market share, acquiring a bank with 2% – 2.5% market share was a very important leap, but now looking at quite small banks becomes hard to motivate, to argue.
Broad Consensus on Consolidation Trends
Other banking leaders at the conference also weighed in on the consolidation trend. Sergiu Manea, CEO of BCR, mentioned that Europe would focus on national consolidations in the next three to five years, which could involve both organic and inorganic strategies.
Mihaela Lupu, CEO of UniCredit Bank Romania, echoed this sentiment, noting a growing appetite for consolidation at the European level, which is encouraged by supervisory authorities and the European Central Bank.
Efficiency vs. Competition
Florin Dănescu, Executive President of the Romanian Banking Association, provided a theoretical perspective on consolidation, explaining that while a high degree of concentration might reduce competition, a very fragmented market could lead to inefficiencies. The optimal path would be a balance between these two extremes. Dănescu highlighted that, despite the consolidation, Romania still enjoys a robust level of competition compared to other European countries.
