2021 was a complicated year for the Business Banking business, which grew less than expected due to various environmental circumstances:
- The macroeconomic scenario was less favourable than expected, with economic growth slowed by the expansion of the omicron variant, the reappearance of inflation and problems in the supply chain.
- There was excess liquidity caused by the large number of loans guaranteed by ICO and Cesce in 2020, which limited the financing requirements of companies, especially in Business Banking.
- The arrival of funds from the European Recovery Plan (Next Generation EU) was delayed, which barely had any impact on economic activity in 2021.
Despite these adverse conditions, the performance of loans and receivables in Business Banking was slightly positive, reaching 28.7 million euros, with an increase of 1% compared to the previous year. In addition, this slight growth, allowed it to increase its gain market share (5.4%, compared to 5.3% in 2020), since investments in financial institutions as a whole fell by 1.4%, according to corresponding data up to November.
Clear strategy for European aid
The aid awaited from the European Union hardly had any impact on the economic fabric, so the bank was unable to exercise its triple role of channelling, advancing and supplementing business financing using European funds. However, Business Banking adopted a clear and intense strategy to prepare for the arrival of the aid in 2022 and subsequent years throughout the year. This phase of preparing now in order to reap the awards later was based on several lines of action.
- Closer contact with companies to find out their level of awareness of the aid. It turned out that most of them had very little information.
- Webinars campaign and other training actions between customers and potential customers, especially in the sectors expected to most benefit from the aid.
- Partnership agreement with the CEOE employers' association to provide customers with access to an information platform on tenders and calls for public aid, including an alert system for companies and self-employed workers interested in specific sectors.
- Agreement with two consultants specialised in raising and managing European funds, which are put in contact with Bankinter customers to explore opportunities.
This continuous effort regarding information and preparation resulted in the number of companies registered in the advisory and support service for European aid to exceed one thousand at the end of the year.
European funds, if they do finally reach companies as expected, will be a vital lever in terms of restoring the usual investment growth rates to levels seen in recent years in 2022. For each business unit, the strategies and growth prospects for this year are as follows:
- Business Banking. One of our main aims is to increase our specialisation, as has been done in the field of structuring operations.
- In Investment Banking, we will reinforce our support for customers in capital markets issuances and we will play a more important role in the mergers and acquisitions market.
- Medium-sized Banking. The aim is to reinforce our policy of customer proximity and to establish a very close relationship with our day-to-day business. This strategy yielded excellent results in 2021, since the pre-pandemic level of working capital was recovered and the rate of return on investment significantly improved.
- SMEs. The goal is to streamline management and make progress in terms of productivity. Tools which facilitate the consultation of companies the customer works with have been developed, such as economic networks. In addition, the 'Business Plan' has been launched, which automates the conditions of customer relationships based on their loyalty with the entity.
- International banking. After a difficult financial year, in 2021 affected by the economic environment, logistics problems and the rising price of commodities, a strong recovery in activity is expected. The successful implementation of the foreign exchange broker business and the creation of a platform to facilitate payment transactions for suppliers is set to help to achieve this objective.
In addition, the dynamics of corporate mergers in the national financial sector may bring new opportunities to attract customers.