BUSINESS REVIEW 2013 BUSINESS REVIEW 2013 Table of Contents page BRIEF HISTORY ............................................................................................................................................................................................. 8 KEY INDICATORS .......................................................................................................................................................................................... 9 LETTER FROM THE CHAIRMAN .................................................................................................................................................................... 11 LETTER FROM THE MANAGING DIRECTOR - CEO ........................................................................................................................................ 15 SHARE .......................................................................................................................................................................................................... 21 SUCCESSFUL COMPLETION OF THE BANK’S CAPITAL STRENGTHENING PLAN .......................................................................................... 22 ACQUISITION OF EMPORIKI BANK, RESTRUCTURING PLAN AND REALISATION OF SYNERGIES ................................................................ 24 1. THE GREEK AND THE INTERNATIONAL ECONOMY IN 2013 AND THE OUTLOOK FOR 2014 .................................................................... 27 2. BUSINESS UNITS ...................................................................................................................................................................................... 35 Retail Banking and Small Enterprises ......................................................................................................................................................... 35 Medium-sized Enterprises and Large Corporations .................................................................................................................................... 41 Asset Management and Insurance ............................................................................................................................................................. 44 Investment Banking and Treasury .............................................................................................................................................................. 47 Southeastern Europe ................................................................................................................................................................................. 52 Other Activities ......................................................................................................................................................................................... 56 3. OPERATIONAL SYSTEMS AND DISTRIBUTION CHANNELS ...................................................................................................................... 59 Operational Systems and IT Projects ......................................................................................................................................................... 59 Certification of Critical Business Sectors ................................................................................................................................................... 60 Branches, Alternative Networks and Electronic Services ........................................................................................................................... 61 4. RISK MANAGEMENT ................................................................................................................................................................................ 67 5. CAPITAL ADEQUACY ................................................................................................................................................................................ 79 6. CORPORATE GOVERNANCE ..................................................................................................................................................................... 83 Board of Directors ..................................................................................................................................................................................... 84 Audit Committee ....................................................................................................................................................................................... 87 Risk Management Committee ................................................................................................................................................................... 88 Remuneration Committee .......................................................................................................................................................................... 89 Executive Committee ................................................................................................................................................................................ 91 Certified Auditors ...................................................................................................................................................................................... 91 Internal Audit ............................................................................................................................................................................................ 91 Regulatory Compliance .............................................................................................................................................................................. 92 Group Information Security ........................................................................................................................................................................ 93 Organisational Chart .................................................................................................................................................................................. 94 7. AUDITORS’ REPORT AND FINANCIAL STATEMENTS ................................................................................................................................ 97 8. OPERATING SEGMENT AND GEOGRAPHICAL SECTOR ANALYSIS ........................................................................................................... 107 3 This year’s Business Review is illustrated with advertising material - that will constitute the theme of the Historical Archives forthcoming exhibition - drawing on the period starting when Yannis Costopoulos assumed the duties of Managing Director and reaching to the present day, on which he is pronounced Honorary Chairman. margin, as well as some which were either not embraced by This period spans forty two years on the course of which the our Customers, e.g. Drive-in banking, or became outdated due Bank grew to an impressive extent, developed into a Group to technological and transactional advancement, e.g. night providing financial services and acquired an international profile, depository vaults. All of them bear the seal of the constant thanks to the vision and the ideas of its Management. pursuit of quality by Yannis Costopoulos who, in the mid-1990s, Countless daily banking habits were introduced by the Bank added the word “Alpha” to the international corporate name of which, during that period, adopted: its new name, Credit Bank; the Bank as well as the national colours to its logo, in order to its logo, that derives from the reverse type of the first coins in enhance its Greek identity. Greece, minted on the island of Aegina in the 6th century BC; as The beginning of the 21st century is marked by two major well as the friendly and modern customer service reflected by events: the acquisition of the Ionian Bank in 2000 and that of the use of the word “Mazi” (“Together”, in Greek). Emporiki Bank in 2013, which have contributed greatly to the This Review presents a selection of established innovations, rationalisation of the Greek banking system and the creation of a e.g. ATMs, cashcards and the launch of a prime rate with a Greek bank of significant size within the United Europe. 4 5 1972. Yannis S. Costopoulos assumes the duties of Managing Director. The Bank is renamed Credit Bank from Commercial Credit Bank. A new corporate logo is introduced which derives from the reverse type of the silver stater of Aegina (480-456 BC), the city-state which was the first to mint coins in Greece. Business Review 2013 Brief History Key Indicators The history of Alpha Bank begins in 1879, when John of Greece S.A. and in June 2013 the legal merger by absorption Group Data Alpha Bank Emporiki Bank F.Costopoulos founded a commercial firm in Kalamata, of the latter by the former was completed. Emporiki Bank (in Euro million) Change % 2013 2012 2012 which quickly undertook banking activities, especially in the was founded in 1886 and was a historical bank, which played BALANCE SHEET foreign exchange market. In 1918, the banking arm of the a key role in the economic development of Greece during the Total Assets 26.5% 73,697 58,253 19,517 J.F.Costopoulos firm was renamed “Bank of Kalamata”. In 20th century. At the end of 2012, it maintained a Network of Loans and Advances to Customers (gross) 29.8% 58,634 45,185 19,853 1924, the Bank was renamed “Banque de Crédit Commercial 323 Branches