1. The previous year has been difficult and challenging. In what way will employees at Eurobank remember it?

Under these unusual circumstances, the priority of Eurobank was to protect the health of both our employees and their families and provide our clients with easy and safe access to all our services and products. In order to achieve these goals, we had to be flexible, quickly adjusting to new circumstances. Thus, the previous year will be remembered both as highly challenging, but creative and innovative as well. Eurobank has implemented numerous innovations and various changes within its activities that have influenced the general mode of operation by making it more efficient. To give an example, working from home has been introduced in order to protect the health and safety of employees during the pandemic. In the meantime, this new model turned out to be highly efficient and productive. Moreover, further optimization and simplification of different business processes have been achieved by introducing everyday online communication, thereby decreasing the need for physical presence or even completely cutting it off, as well as by full implementation of electronic document signatures. These and various other initiatives and innovations, not being the goals in themselves, contribute to the establishment of a new, modern model of operation of the Bank, enabling the necessary stability as well as flexibility in its future activities.

2. Considering the stagnation of the market worldwide, it is essential to maintain the Bank’s portfolio and to improve its quality. How do you deal with this issue in Serbia? How would you describe the banking sector in Serbia during the period of the pandemic?

The banking sector in Serbia has learned quite significant lessons during the previous year. For us at Eurobank, these lessons included the establishment of an efficient early alert system, i.e. a system that enables the timely identification of difficulties our clients may face while performing activities, and reaching an acceptable solution to the problem through communication. In the focus of the last year’s activities of the banking sector was showing support to the Serbian citizens and economy by: providing payments of pensions to the eldest citizens within safe conditions during the emergency state, followed by providing payments of direct state aid by opening special accounts, conducting two moratoriums with the third one being in progress, continuation of lending to the economy both on an ordinary basis and from the assets within state credit guarantee schemes, as well as providing continuous operating of branch offices and retail lending. Furthermore, realizing the significance of supporting the health system and healthcare workers in every possible way during these challenging times, the banking sector donated considerable amounts for medical and protective equipment and other related purposes in order to contribute to the battle against the pandemic. In conclusion, the banking sector in Serbia has certainly demonstrated its stability even during the pandemic and proved to be a strong pillar of the economy.

3. So, the banking sector is an important puzzle piece when it comes to economy. To what extent have regulators contributed to the continuation of banks´ successful business in such challenging times? Have you expected more from them concerning the facilitation of your everyday business?

Being one of the economy´s supporting pillars, the banking system has been and still is responsible for supporting clients in overcoming potential difficulties caused by the crisis and maintaining economic stability jointly with the government and the National Bank of Serbia. From my perspective, we live up to this expectation so far. As for the banks, by making necessary changes on regulations and/or extending the deadlines for implementation of regulations within its domain, the regulator has provided them with certain regulatory benefits. We sincerely appreciate the procedures that have reduced the pressure in terms of general operation, enabling the banks to use their capacities and resources for performing their priority activities.

4. Another important component of Eurobank's business strategy is corporate social responsibility. Which projects have you already realized, which of them are you particularly proud of and which areas are you going to focus on in the following period?

Eurobank pays special attention to corporate social responsibility, which we consider an integral part of our business strategy. We invested more than €4.7 million in different initiatives and projects so far. By making donations for obtaining necessary medical resources and equipment, we paid special attention to supporting the Serbian health system in the battle against the pandemic during the past year. We are particularly proud of our multiply awarded Manchester United Soccer School project realized in 2019 as well as our An Ideal School For You (“Škola kao nacrtana za vas“) project, which has been realized with the support of the Ministry of Education, Science and Technological Development devoted to the improvement of the conditions of high school education and which we will continue this year and in the future.

5. For a few years now, non-performing loans have been a major problem on the local market. What is the situation at your Bank when it comes to collection of non-performing loans?

Within the Serbian banking sector, the NPL ratio amounts to 3.7% for 2020, which corresponds with the European average, while representing a significant reduction in comparison to the period five years ago when it was approximately 21%. Thus, it can be concluded that the banking sector has successfully dealt with non-performing loans from the previous crisis period by using combined measures involving collection, restructuring, and write-offs. Eurobank actively contributed to these efforts, considerably reducing the number of its non-performing loans. However, a new wave of non-performing loans is likely to be generated by the pandemic. Should such a situation arise, Eurobank seeks to meet the requirements of clients in need by using its own financial strength, as well as mechanisms of regulatory support and state aid for corporations and consumers. Apart from enabling the sector to absorb and overcome all negative effects of the pandemic more easily, this model of cooperation with clients contributes to the prevention of the emergence of new non-performing loans. Therefore, the quality of the credit portfolio is maintained at a higher level, providing the possibility of collection of receivables from regular flows, instead of performing enforced collection within the period after the termination of current (temporary) situation caused by the pandemic.

6. Eurobank is particularly focused on economy and small and medium-sized enterprises businesses. How do you help your clients to improve their activities and achieve their envisioned goals?

In this situation, it is very important to us to support client categories that have been most affected by the crisis, i. e. small and medium-sized enterprises, especially industries related to service and people, goods and service provision at an international level we consider key to the vitality of our economy. In addition to its standard portfolio, Eurobank grants loans from state credit guarantee schemes both to existent and new clients – micro, small and medium-sized enterprises – for almost a year now. These loans amount to up to €3 million, providing the opportunity of being paid either in Euros or in Dinars, accompanied by reasonable interest rates. The fact that Eurobank placed assets in the amount of ca. €120 million so far reflects the actual need and market demand for such loans and we actively take part in the program again this year. Moreover, significant support has been given to construction and real estate sectors, with our Bank being already well-known as one of the most active ones within this segment, contributing to stability as well as growth of this industry during the period of pandemic, too.

7. We are all aware of the fact that using of digital channels has been taking primacy over the traditional banking. Please tell us something more about digitalization in the banking sector from Eurobank's point of view.

Digitalization has become part of our everyday life, not only within the domain of banking services, but in a broader social context as well. In order to remain relevant for the market, banks tend to introduce innovations, as well as improve the existent processes and products in line with technological development that introduces innovations almost on a daily basis. Today, financial transactions are faster than ever, with the expectations of digitally educated clients being even greater. A few years ago, digital channels became the preferred means for performing transactions by legal and natural persons. The instant payment system, which has only recently been gradually introduced in numerous developed countries, has already been widely used in Serbia, which enabled the introduction of numerous advanced services. Clients have the possibility to pay their bills by scanning QR code, and soon they will be able to transfer the assets to their family members or friends by simple selection of a certain number from their phonebook. Depending on their own rhythm of life or business, numerous clients perform cash transactions via most modern cash machines, regardless of the working hours of branch offices. Due to the fact that a great number of clients are already familiar with digital channels, they decide on using advanced services including applying for credit products, buying travel insurance, activating and blocking bank cards, personal finance monitoring, scheduling appointments and communicating with the bank via mobile applications, audio or video chat functions etc. We expect an increasing number of clients to establish their first business relationship with the bank fully digitally in the future. This does not mean that traditional banking and branch offices will completely disappear, but clients will be provided with more options, while the banks will have more business flexibility. The support of the state is definitely worth mentioning, not only in terms of support itself, but in terms of promoting a digitalization process within all social segments as well, in this way proving its strategic importance.

8. What were your plans at the beginning of 2021? How satisfied are you with the results achieved so far?

The main goal of Eurobank for 2021 is to remain a strong support and reliable partner to our clients and business partners both in their personal and professional enterprises, as well as to continue supporting our business community by conducting projects related to corporate social responsibility. We do hope that the health situation in our country will be stabilized in the course of this year, yet we are still prepared for challenges to come. Over the years and during the recent crisis period, we have succeeded in maintaining the stability of our Bank and the successful conduct of business in Serbia. Thus, we believe that the efforts made and the strive for continuous improvement of our products and services will contribute to the Bank´s further growth and development, which we do not aim for only in 2021, but for the long term.