Group Corporate & International serves as the centre of expertise for Hypo Group Alpe Adria’s international corporate customers. This division acts as a central hub for communication, coordination and information, and it connects customers up with the appropriate local contacts for their requirements in the branch offices. Services range from financing through cash management, processing of international payment transactions, documentation services and trade financing through to investment products. The Group Corporate division also includes Group International & Documentary Business, which as a Center of Competence guarantees high-quality trade finance services throughout the Group.

The effects of the worldwide crisis in liquidity were felt in 2008, in particular in the second half of the year. One of them was to ease the pressure on margins of previous years. Corporate Banking performed well in this environment and was able to show growth. The volume of assets in the Group grew from EUR 11.2 bn (at year-end 2007) to EUR 12.8 bn at the end of 2008, an increase of 13.6 %. International & Documentary Business further extended its market leadership. Particular value is attached to sector diversification in order to minimise customer portfolio risk.

Group Corporate

Thanks to the wide geographical coverage of its sales network, Hypo Group Alpe Adria is the partner of choice for small and medium-sized enterprises in the extended Alps to Adriatic region. Corporate Banking not only meets the needs of SMEs with its services, but is an important partner for industry, for large institutional and private companies as well as for privately-owned groups, which have, in Hypo Group Alpe Adria, a business partner present throughout South Eastern Europe and staffed by highly competent employees with comprehensive knowledge of their regions. Overall, Group Corporate was able in 2008 to build on the positive development of previous years, even though the granting of credit was more selective in the second half of the year and volume growth slowed as a result. Margins and collaterisation were higher in return. But business was marked by the growing uncertainty on the financial markets. Liquidity costs, which had risen disproportionately because of the economic conditions, could in most cases be passed on to customers for existing financing arrangements as well. In part the collaterisation was also increased. Hypo Group Alpe Adria, as a strong finance partner in the region, financed such high-profile projects as “Block 67”, the Olympic village for the Universiade in Serbia. Further projects in which Hypo Group Alpe Adria took a leading role included tourism projects in Croatia, as well as private housing and tourism projects in South Eastern Europe.

Selective granting of credit, coupled with the requirement for greater creditworthiness, and thereby selective growth will also be to the fore in 2009. It has to be assumed that the difficult economic conditions will continue to prevail in all countries. That makes knowing the customer well, as a result of a longstanding business relationship, coupled with the extensive expertise of our employees, a basis for trust from which the partners can work together to develop the right solutions specific to the customer.

International & Documentary Business

International & Documentary Business serves as the Group’s international competence centre for letters of credit, international guarantees, collections and non-recourse export financing. The section was able to extend its activities successfully into BayernLB markets such as Asia, Hungary, Romania and Bulgaria and to benefit from BayernLB’s product expertise in 2008. Taking account of customer requirements, Hypo Group Alpe Adria placed even more emphasis on quality of service and product development in 2008, and exploited Group synergies for the routing of customer transactions. Thus, for example, letters of credit were routed to Asia via BayernLB and back again to Austria in the same way. Documentary Business also deployed new software, which is leading to more efficient servicing of customer requirements and freeing up time for more advisory activities. Overall, International & Documentary Business was able to strengthen further its market position during the year.

Hypo Group Network

The Hypo Group Network was put in place in 2007 to leverage growth in international business. The entry of BayernLB was and is a source of great opportunity for the Hypo Group Network: the number of potential customers with overseas orientation has increased enormously, particularly through the cooperation with the savings bank sector in Bavaria. Through the excellent market position of the Bavarian savings bank sector and the high export levels of German companies in Hypo Group Alpe Adria’s core markets, there will be huge opportunities for growth in the future. More than double the previous year’s number of customer interactions, in the form of events and direct meetings with customers, were enabled during the year under review. These led to synergy effects: new financing, documentary and settlements and payment business won in the year could definitely be attributed to the increased customer contact.

Cross-border support and advice for corporate customers is a matter of priority for Hypo Group Alpe Adria and is reflected in all of Group Corporate & International’s activities. As an example of this, a Group-wide database of customer enquiries was introduced during the year, in order to raise the quality of service still further.