Pragmatic Stopanska Schooling Macedonia’s Businessmen on the Art of the Pitch

American Times Feature with Mr. Diomidis Nikoletopoulos, CEO of Stopanska Banka AD

Stopanska Banka AD – Skopje holds the distinct position within Macedonian society as its oldest financial institution and formerly, interestingly enough, as its designated meeting spot for non-Skopjeians. Opening its doors in 1944 as a state-owned enterprise, the Bank maintained its status as an SOE until the National Bank of Greece*, the largest commercial bank in Greece, purchased majority shares in 2001 (today NBG owns 94,6%) and maintained its status as the go-to rally point until, arguably, the Alexander the Great fountain was erected. The latter being pure conjecture, but a thought not many that have visited the city would argue over.

Aside from foreign shareholding, Stopanska bank appears to be a legacy brand in Macedonia, one in which people consider a trusted and safe institution. As such, the Bank maintains its Macedonian soul with respect to its strong history within the country by honoring its tradition as the oldest financial brand in the nation. We sit down with Stopanska bank’s newest CEO, Mr. Diomidis Nikoletopoulos to speak about how ‘a legacy’ contributes to the bottom line, what the competitive forecast looks like and what Macedonia needs most.

What is your perspective on the domestic banking sector?

Firstly, there are many foreign players from France, Turkey, Austria and Slovenia, which to me indicates the initial potential upon these entries several years ago. Currently, I would say that Macedonia’s banking sector is moderately developed with an overall market penetration lower than average European levels which offers some potential as well. Volume-wise, the total loans outstanding here equate to about €3.6 billion with deposits of €4 billion, so the system is self-funded and done so domestically.

The quality of assets in the banking system are quite good as well. Primarily loans are allocated to the retail market and corporations with emphasis given recently to SMEs, and an NPL ratio, although increasing, still at manageable level.

Where do Stopanska’s numbers fall in comparison to those macro figures?

We are proud to say that this month (September, 2013) we have reached €1 billion in deposits, all sourced domestically. This number probably seems low if compared to other countries, but for the local market it is a significant achievement. Although we are fully committed to corporate products we are more active in retail lending products; where we hold a dominant position with 63 branches, employing over 1,000 people, equating to a 36% market share.


When a businessman comes to present a business plan, we have the potential to revise and consult so that in the end we accept only the best and well-conceived plans.


How do you intend to propagate those figures in the coming years?

The Bank, as part of the biggest banking group in the area, cannot be characterized as very “aggressive”. Meaning, we will look at each move strategically by focusing our promotional activities on our specific target groups thus increasing our business activity and profitability and avoiding non-performing exposures. With this more cautious approach, we may miss some opportunities during the sunny days but will remain sturdy during the rainy days. I think this stance is what allowed us to pass through the worst of the crisis without having to take on losses.

I believe that we are in the best position to deliver quality and sound products for the future of Macedonia by continuing our innovative course of action. We have the best portfolio, strongest customer base, largest network, group know-how and experience, which in the ends affords us the luxury of financing projects based on our risk appetite. When a businessman comes to present a business plan, we have the potential to revise and consult so that in the end we accept only the best and well-conceived plans.

Based on this strategy, how do you find your competitiveness as it stacks up to the other two largest banks in Macedonia?

Well, I would say that all three big banks in the country, Stopanska Banka, NLB- Tutunska [Slovenia] and Komercijalna Banka [Macedonia] are facing their own unique individual challenges. NLB’s parent bank has economic considerations that are in the forefront of their decision making processes that have slowed expansion in Macedonia and Komercijalna Banka, with no larger parent bank, has to grow within the constructs of the overall growth of the Macedonian market.

…but I believe with some corrective measures in this regard the country and its citizenry can recognize a well-rounded competitive advantage. They must believe in themselves first.

Overall I’d say the banking sector is growing but at a moderate rate, around 2.6% in Q1 and annualized at above 5%. Stopanska during this same period achieved 3.3% growth, so we are outperforming the market at this point. All of this is to say that if any of the 3 largest banks were to create the framework for the future it would be Stopanska.

Well, this then begs the question: Why is Stopanska not seizing this opportunity in the marketplace?

It is not enough to say that we have the appropriate funds to execute a more aggressive strategy. You should have the appropriate risk appetite, which is somehow defined by the market. The driving factors behind the development of an economy are the businesses, and sometimes here they are not structured or as well prepared as they need to be based on what they are asking from the banks.

FOR EXAMPLE: A businessman enters and primarily pitches his idea; the concept may be good, but the Bank needs a more structured and sound proposal. Sometimes businessmen fail to recognize how a bank operates; that there are best practices and strict frameworks and formulas in which a bank considers very carefully during its decision making process. So, we act as their financial partner by explaining to them these factors but also try to educate them as well regarding the burden of proof. As such, I would like to see the business prospects. It is their job to make us to understand fully their proposal(s) and convince us about the prospects. Essentially, we are striving to continue implementing this process which is normal to the Western world’s banks and businessmen interactions.

In conclusion, the general framework exists here; good taxes, business oriented legal framework, English speaking workforce, affordable labor, sound banking sector, etc. However, in my opinion the people need to be more extroverted, more dynamic, but I believe with some corrective measures in this regard the country and its citizenry can recognize a well-rounded competitive advantage. They must believe in themselves first.

So, this is the business framework I would like to see from both sides in order for us to upgrade to the desired level of support.

*[Editor’s note: a private bank, not to be confused with the Central Bank of Greece]