The banking sector was much more fragmented a couple of years ago, and I believe that it will be further enlarged in the future, said Vlastimir Vukovic, President of the Executive Board of Komercijalna Banka, at the Summit of Economic Leaders.
When asked by the panel’s moderator whether the Game of Thrones is taking place on the banking market, Vukovic answered that the fight is “still cleaner” than in that series and compared it to another popular series – “Quuen’s Gambit”.
When it comes to additional enlargement of the sector, ie reduction of the number of banks, he believes that two reasons are key.
“Economies of scale play a significant role in the banking sector, and on the other hand, the corona virus and the state of the economy have accelerated processes, as certain investors have realized they want to play in other markets, and some see Serbia and the region as a natural destination,” said Vukovic.
When asked to clarify the paradox that banks expect that clients will benefit from less competition, ie from enlargement on that market, Vukovic cited the example of football clubs “Partizan” and “Red Star”.
“Do they need more competitors so that they don’t play every game as if it were the last,” Vukovic asked, emphasizing that in the banking business, it is enough that there are two competitors for the fight for clients to be serious.
“The banking sector will face competition that is not from the same sector – with fintech companies that come from the technology sector. And that is one of the reasons why there is an additional enlargement in the banking sector,” said Vukovic and assessed that digitalization is “inevitable” in all sectors, including the banking sector.
Asked about the possible impact of global economic trends, including inflation, on banks in Serbia, Vukovic said that the banking system in Serbia is stable, highly capitalized and ready to provide security to clients, N1 reports.
