BUDAPEST, Nov 30 (Reuters) - Hungarian savings and loans group Takarek plans to create a universal bank by merging some businesses and cutting costs by 25 billion to 30 billion forints ($88 million to $105 million) in the next five years, it said on Friday.
The loss-making group, which is aiming for a 10 percent market share and annual net profit of about 30 billion forints by 2023, competes with domestic OTP Bank and major foreign lenders, such as KBC and UniCredit.
Takarek Group posted a loss of 12.3 billion forints under Hungarian accounting standards last year despite a general economic upswing and a boom in lending, which has bolstered the profitability of most lenders in Hungary.
The savings sector, which received a 135 billion forint state capital injection in 2013, plans to close loss-making branches under a new strategy, the latest step in an overhaul to boost the standing of domestic banks versus big foreign lenders.
“We have everything for 2019 that enables us to bake a good cake,” Takarekbank Chairman and Chief Executive Jozsef Vida told a news conference.
The group, which has 1,140 branches, more than the eight major banks in Hungary combined according to a press release, ranked as the fourth-biggest lender based on total 2017 assets behind OTP and the Hungarian units of KBC and UniCredit.
However, it said the group was at a “significant market disadvantage” versus its major rivals in terms of operating efficiency and profitability. ($1 = 284.7 forints) (Reporting by Gergely Szakacs; Editing by Adrian Croft and David Evans)