The bank takes stock: Raiffeisen Carinthia records slight growth in the crisis of 2022

Despite the crisis environment, the year 2022 was marked by slight growth for the Carinthian Raiffeisen Banking Group. In an inflationary environment, total assets rose 1.3% to €11.1 billion. The number of customers has remained roughly stable at 281,000, more than every third Carinthian bank customer working for Raiffeisen Bank, and every second among corporate clients.

Funding is clearly at an all time high in 2022, rising by around six percent to 6.4 billion euros. Corporate financing, in particular, grew strongly by nine per cent, but demand for housing loans collapsed by nearly 50 per cent after a strong half-year, explains Gert Spanz, CEO of Raiffeisen Landesbank (RLB) Kärnten. This is due to interest expenses, which have risen sharply in parallel with construction costs, and greater obstacles to borrowing.

The basic capital ratio is more than 16 percent

Raiffeisen customer deposits in Carinthia grew slightly to €6.9 billion, the core capital ratio decreased slightly from 16.9 percent in 2021 to 16.6 percent, but the minimum legal requirements were clearly exceeded. A strong increase in risky loans is not expected, although the higher risk provision of €16m is reflected in the work programme. However, major failures have not yet been a problem. In all, Carinthian Raiffeisen Banks reported an operating result of €76 million, an increase of 12.5 percent over the previous year; The work program remained flat at €58.3 million. One is “extremely satisfied” with the balance sheet numbers, RLB’s board of directors unanimously affirms.

Further decrease in the number of bank branches

The trend towards digital banking has not stopped, with nearly 140,000 customers using Raiffeisen’s electronic banking services (ELBA), and an innovative platform for business customers (“Infinity”) is about to be launched. With consequences for fixed bank branches: their number decreased from 128 to about 120 in a year. Many customers today use digital services, so the number of bank branches will tend to decrease, explains RLB board member Georg Meisner.

Results are expected to increase further in 2023

For the current year, board members Peter Gauper and Spanz expect further growth, as already seen in the first quarter. Supported by a shift in interest rates, results should increase, but credit default risks will also increase. Criticized by consumer advocates for being slow to pass rate hikes on to Gauper-resisting savers, restricted savings deposits would reap a huge benefit; One earns “without a money basket”, but makes “offers according to the interest rate structure”. Guber expects the ECB to raise interest rates further to curb inflation, and for the ECB’s interest rate meeting on May 4, he expects another big jump of half a percentage point to 4.0 percent.

Nothing has materialized (so far) from the great success of the Reserve Bank of India (annual profit 2022: 3.6 billion euros), in which RLB Carinthia has a 3.53 percent stake: for 2022, the Annual General Meeting of the Reserve Bank of India decided not to pay dividends in present time .