Emerging Europe

Bad debts spark second wave of sector losses; CEO says low-cost, credit card model key to success.

In 2013, Russia’s central bank became a mega-regulator, overseeing a slew of credit institutions, from banks, insurance agencies, investment vehicles, micro-finance houses to pawnshops. That makes Elvira Nabiullina the most powerful central banker in modern Russian history.

Bad debts, low valuations and a lack of appetite for expansion among strategic players have kept a lid on banking sector M&A in emerging Europe since the financial crisis. Now the recovery of key regional banks and the emergence of new investors is driving a resurgence in activity. But will it last?

A prolific bank buyer but notoriously publicity-shy, Igor Kim is little known outside his native Russia. In his first major interview with the international media, he talks about expanding into Europe, surviving a spell on Canada’s sanctions list and why global banking models are doomed to failure.

The country’s bloated public sector and rapidly rising government debt burden have alarmed analysts and prompted comparisons with Greece. As the nation emerges from six years of recession, however, central bank governor Boris Vujcic argues that there is much to celebrate.

China’s struggle to communicate effectively with markets was demonstrated by its scapegoating of journalists for supposedly worsening the crash in local stock prices.

$5.8 billion bill for loan conversion; portfolios ‘impossible to price’, say analysts.

Banks and corporates have continued to ratchet up foreign-currency borrowing over the past two years. The big lira sell off this summer amid a local political crisis highlights how much higher funding costs could bring trouble for Turkish banks.

Far from stabilizing, the sovereign’s economic imbalances and political uncertainties are behind another round of downgrades.

Only time will tell if snapping up Ukrainian bonds before its creditor negotiations are complete is fortuitous or foolhardy, but what cannot be denied are the enormous risks involved.

When seven failing cajas were forced together, it was supposed to dampen their problems, not amplify them. Despite many doubts and hard decisions, Bankia’s chief executive Jose Sevilla Alvarez has been ambitious in restoring profitability and recovering the bank

More secondary listings likely; consumer, tech, export stocks in focus.

Two successful IPOs should have been good news for the country’s markets – if anyone had bothered to tell the world more about them.

Banks are prepared to sit through a couple of lean years in emerging Europe’s largest market, given that it will bounce back eventually. They might not want to get too optimistic though.

Global funds pile into Romania; Hungary, Slovenia next hot spots.

Data from Euromoney’s survey of country risk suggests economists are increasingly optimistic about the Hungarian economy.

Hungary may have steered an unorthodox economic policy course but it seems to have worked, pulling the country out of recession and putting it back on a growth path.

As economy minister and central bank governor, György Matolcsy has been one of the leaders of Hungary’s unconventional drive to economic recovery

Foreign investors are starting to appreciate the opportunities available in an economy that has turned itself around.

The sovereign has become comparatively safer in Euromoney’s country risk survey as its CIS neighbours find it hard to escape the blow-back from Russia’s meltdown and currency devaluations prompted by the new oil metrics.

Politicians have long been whipping up nationalist sentiment in Russia and Turkey. But now Poland is joining in on the act, banks and investors in CEE have reason for concern.

Are currency depreciation and an uncertain political environment pushing international banks away from Turkish assets? The expected sale of HSBC’s local unit could hold the answer.

Hungary is set to receive $29 billion in EU funding for development over the next seven years.

Hungary’s medium-sized industrial firms are becoming more competitive and exporting on a European scale.

Growing Hungarian companies are increasingly looking for equity funding. The 150-year-old Budapest Stock Exchange is ready to help.

Italian lender back in acquisition mode; further losses forecast in Ukraine.

The sovereign is one to watch in 2015, and not just because of the eurozone recovery, or conversely its vulnerability to Greece.

Raiffeisen insiders insist the bank’s current woes stem from circumstances beyond its control. Outsiders say the business is now paying for the sins of the past. A new leadership is desperately trying to reposition a bank whose most important markets are in turmoil, and whose ownership structure leaves it with unique capital challenges. CEO Karl Sevelda has a mountain to climb.

The banking regulator in Poland has a well-earned reputation for toughness, but it might want to try a little tenderness when it comes to Raiffeisen wanting to leave.

The rouble’s crash sent currencies tumbling across the Caucasus and Central Asia. Banks look relatively well placed to withstand an inevitable downturn. But with protracted stagnation looming, is it time for policymakers to build bridges further afield?