Erste Group Bank: Erste things first – Valentin Florin Galatanu

Serving Central and Eastern Europe, Erste Group Bank offers its clients a number of cross-border solutions including cash management, trade finance and forex. Executive director Valentin Florin Galatanu reveals how the group draws upon its wealth of local knowledge and technical expertise to help companies optimise their supply chains.

With a client base comprising a mix of both large multinational companies, and small and medium-sized enterprises (SME), Erste Group Bank is one of the leading financial providers in Central and Eastern Europe (CEE).

Today, one of its main strengths lies in its ability to offer customers in-depth local knowledge of its markets in order to facilitate supply chain optimisation - a pertinent issue for CFOs and group treasurers. This also involves adopting a holistic approach, underpinned by integrated supply chain practice, according to executive director Valentin Florin Galatanu.

"When discussing supply chain optimisation, we normally think about the most sophisticated and advanced developments," he says. "But very often it is the simple solutions that help clients to become more efficient. The most common starting point in the process is to integrate the whole flow of a company's activities within the bank, starting with its suppliers and closing with its clients. In this way, the company can benefit from swift transfers and lower banking costs.

Currently, Erste's customer reach extends to 3,200 branches in eight countries- Austria, Croatia, Czech Republic, Hungary, Romania, Serbia, Slovakia and Ukraine. In Galatanu's opinion, it is its aforementioned local expertise that makes the group the perfect partner for corporate customers looking to further support and expand their economic activities in the region.

"We are a universal bank," he says. "As opposed to an ivory tower situation, when banking groups are too far away to understand regional conditions and regulations, we have employees on the ground that are able to bring value and information together. Also, we are involved in retail in all of these countries. This is something that we perceive as beneficial for companies looking to offer employee advantages."

Within the CEE universe, there are a number of different legislations and regulations particular to each country. In successfully delivering cross-border solutions to corporates looking to optimise their supply chains, Erste makes use of its network of legal experts and tax advisors, ensuring that all regulatory minutiae is adhered to.

"We acknowledge that different countries will have different interpretations of complex subjects such as financing and debt management," says Galatanu. "However, I wouldn't say that they are acute problems, but rather challenges that can be out-run through analysis and creative thinking. We play an active role in participating in local country debates concerning changes in legal rules and frameworks. In this way, we aim to be the voice of our customers."

In accordance with electronic banking systems, used to ensure speed and security of transactions within the processing chain, recent years have also seen Erste foster its technological solutions. The group has a team of specialists that offer a number of IT banking solutions to companies, including internet banking, MultiCash and other alternative channels. In order to stay ahead of its competitors in this field, the group has an ongoing investment policy in place.

"Investing in technology is a continuous process," says Galatanu. "It's not like buying a vintage car and waiting for its value to grow. Instead - similar to any business transaction or cash payments operation - you need to remain ahead of the curve by investing money. It is really important. Technology can help both local companies and multinationals gain access to the bank through a single gateway, making it easier for them to integrate their ERP systems with back-office structures. Moving up the ladder, we are looking to become increasingly involved in offering solutions for the optimisation of working capital and cash flow, which has a starting point in supply chain structures."

"Erste makes use of its network of legal experts and tax advisors, ensuring that all regulatory minutiae are adhered to."

From purchasing and sales getting on with payments and collections, today's companies, more than ever, require a more cohesive approach to supply chain optimisation, so as to initiate and process transactions both locally and abroad. In appreciating the intricacies of its clients' supply chains, Erste's customer service line is based on flexibility, offered to all clients irrespective of size.

"I cannot say that there is one single factor that defines our customer service," says Galatanu. "It depends on a number of aspects. From SMEs to multinational companies, we use our extensive knowledge of the local markets and a creative approach towards clients' requests in order to service them best. After having thoroughly surveyed our customers, we haven't observed any desire to have a centralised solution or umbrella approach in serving this group of countries."

Pioneer spirit

Erste has always been something of a trailblazer in serving the CEE region. It was one of the first banks to launch invoicing in Romania and the Czech Republic, ahead of larger multinationals. As it continues to work on new product developments such as e-invoicing - which plays a key part in enhancing supply chain optimisation - innovation is set to further define its future activities.

"Solutions such as e-invoicing also convey the right message about that bank and its capabilities," says Galatanu. "We are capable of providing out-of-the-box solutions tailored to the client's specific needs. This is a source of pride for us."

Despite the ongoing repercussions of the recession, which have seen bank loans become harder to obtain for companies - particularly within the SME sector - CEE is still associated with fast-developing financial infrastructures. In serving pre-existing and corporate customers, Galatanu also stresses the importance of a proactive approach, both with regards to financing solutions and in its marketing activities.

"We have excellent relationship management teams in each of our markets, which service our clients so as to give them an edge over their competitors," he says. "It is also important to bear in mind that in some countries, Erste Group is the leading bank in the market. Therefore, clients, who may have heard from their partners about our solutions and capabilities, often ask actively for our specialist advice.

"We also plan to increase our marketing efforts by participating at different specialised conferences, to enable us to have an even stronger voice in the market and to be in the right position to remain the optimum service provider for supply chain finance solutions."

Valentin Florin Galatanu, executive director, Erste Group Bank.