Scandinavian banks to continue battle

  • 2001-04-19
  • BNS
RIGA - The Baltic states could remain a "battlefield" for rivaling Scandinavian banks for a while, the Nordic states business magazine Northern Enterprise predicted.

The magazine pointed out that although the merger of the Swedish banks Skandinaviska Enskilda Banken and Swedbank has eased the competition in the Baltics, another Scandinavian banking giant, Nordea, has still not actually made its intentions known in the Baltic market. The investment of Nordea in the Baltics so far has been low, which is partly a result of its concentration on consolidation within the Nordic market.

"Now that Nordea has completed its Nordic integration it will be interesting to see if it finally commits itself to a major assault on the Baltic banking markets should SEB Swedbank be forced to sell some of its interests there," the magazine wrote.

Nordea representative Thomas Neckmar said the light presence of Nordea in the Baltics is a result of the bank's strategy of organic growth.

"It is also easier to implement our strategy in a smaller but growing organization than it would be when buying a big organization and having to implement a heavy rationalization program," he said.

In Latvia Nordea owns Merita Bank Riga branch and the situation is similar in the other two Baltic states as well.

SEB, meanwhile, has a controlling stake in Uhispank, the second largest bank in Estonia, Latvijas Unibanka, the second largest bank in Latvia, and Lithuania's largest commercial bank Vilniaus Bankas.

Swedbank is the owner of Hansapank Group. In Estonia, Hansapank is the largest bank, while in Latvia Hansabanka is the country's third largest, while in Lithuania Hansabankas is small bank but is in the process of purchasing Lithuania's Taupomasis Bankas, the biggest state-owned bank in Lithuania.

It is not clear though at this point what will remain under the ownership of the merged SEB Swedbank bank because the bank has not yet announced an operation strategy in the Baltics after the merger.