New arrival on Czech banking scene as Creditas makes debut

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Last year some shake out on the Czech banking scene with one of the upstart new banks aiming to take on the top three or four falling out of the race. But the start of 2017 has also seen a newcomer on the scene with a financial past and some foundations to boast of.

Zuno Bank was one of the casualties of 2016. It was one of the new start-up banks focusing mainly on internet banking and low fixed costs. But it failed to live up to the expectations of its founder Raiffeisen Bank, which eventually announced last year that the new venture would be wound up.

The Czech banking scene is characterized by a few major heavyweights, such as ČSOB, Komerčníbanka, and Česká Spořitelna, a few mid range players, such as Moneta and Unicredit, and a lot of the new entrants seeking elbow room on the market.

In that last category comes the new bank Creditas which has been awarded a banking license from the Czech National Bank. Basically, Creditas got too big for its previous incarnation as in what Czech is known as a záložna – a sort of cooperative bank where loans and services are only offered to members. It has existed on that basis since 1996 but by law it had to make the change and become a bank.

And the new kid on the banking block has ambitions to develop fast this year as the chairman of the bank’s board Vladimír Hořejší explained.

Vladimír Hořejší, photo: archive of Creditas
“Our ambition for 2017 is basically to double the number of our clients and to make sure that these new clients are just as satisfied with our services as those that have been with us in the past year.”

At the moment Creditas has around 20,000 clients and 14 branches covering most of the main towns and cities outside the Czech capital. One of its main selling points is that it makes no charges for the operation of most accounts.

Other Czech banks have also made the same journey as Creditas. One of the most successful has been Fio Banka which became a bank in 2010. It now has 650,000 clients having added an extra 50,000 in the last five months of 2016.

Fio’s main business model focuses on offering free banking services almost across the board. To top up on the lost earnings from bank charges, it seeks to make up on its charges for loans. And Fio claims to have been in profit ever since its made the transition to become a bank.

Overall, Czech banks of all kinds have seen a fairly buoyant past year with enthusiasm for loans still surging on expectations that the recent era of low interest rates is drawing to a close and the Czech National Bank starting to tighten up its rules for granting home loans.