• Experts expect lower lending growth due to lower demand by business and the still expensive financing;

• CEE production recovery, which started in the second half of 2009, is faster than in the developed markets.

The recovery of the production and manufacturing sectors of the economies in the Central and East European countries (CEE) is much faster than on the mature markets. However, the countries from the region can score even better results, if they direct the investments to production and manufacturing rather than to real estate. The efforts must also be directed at creating a better infrastructure, institutional changes and use of the European funds in support of the recovery process. This was the conclusion of UniCredit’s business presentation: “When and how will lending in CEE fully recover?”, held during the XX Annual Meeting of the European Bank for Reconstruction and Development.

Participants in the discussion were Gianfranco Bisani, Head of Corporate and Investment Banking of UniCredit for CEE, Romeo Colina, Chief Executive Officer of АТF Bank, Ricardo Pulliti, Head of Energy and Natural Resources of EBRD, Bahadur Zharov, Head of the Representative Office of Polimetal in Kazakhsan and Debora Revoltela, Head of the Economic Department of the European Investment Bank, who until recently was head of UniCredit’s CEE Starategic Analyses.

“CEE Economies return to growth, thanks to the good performance of production and manufacture, the recovery of which is considerably ahead of that in the eurozone countries. Our projections are for a 4% growth of the CEE economy between 2012-2015, and for this year our optimistic forecasts are for a 2% total growth of the CEE economy”, UniCredit CIB CEE Head Gianfranco Bisani said.

However, despite the good news for the economy, according to Bisani, the credit growth in the following couple of years will remain under the pre-crisis levels, mostly due to the prudence of the business and the lower demand for loans as well as the still high price of lending. Thus, despite the expected increase in the following years, the financial services penetration level in the CEE will remain below that in the countries from the eurozone.

“In most CEE countries there is still a lot to be done regarding the building of a good infrastructure and changes so that the institutions can begin to operate more efficienctly. This will lead to the desired rebalancing of the economies in the region, so that they are more competitive”, said Debora Revoltela. She added that CEE needs a strong banking sector which, if necessary, even to direct the investments to the “correct” sectors, namely – production and manufacturing againt the real estate sector, for example. Revoltela also pointed out that CEE should not miss out the opportunity for support that eurofunds can give in the recovery process.

About UniCredit

UniCredit is a leading European bank with strong roots in 22 countries. Our overall global network covers nearly 50 markets, with over 9,600 branches and more than 162 thousand employees (as of 31 December 2010). The understanding of the individual living situation and the needs of the customers, the companies and the local communities are at the core of our professional commitment. We strive to give specific answers, to generate genuine benefit from the challenges and opportunities encountered by the clients.

In the CEE region UniCredit manages the largest international network with nearly 3,900 branches. The Group operates in Austria, Azerbaijan, Bosna and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Germany, Hungary, Italy, Latvia, Lithuania, Kazakhstan, Kyrgyzstan, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Turkey and Ukraine.

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