Insolvencies Start to Rise Next Year: Erste Group’s CEO

The transcript discusses the potential creation of zombie companies due to economic measures during tough times. It highlights the role of government interventions, such as liquidity support and moratoria, in preventing bankruptcies. The importance of strengthening corporate balance sheets and capital markets is emphasized, with a focus on equity investment. The impact of ECB restrictions on dividend payments is also discussed, along with the bank's profitability and recovery outlook.

What was the initial response to the economic crisis in the region?

• Cutting public services

• Increasing taxes

• Providing liquidity and support

• Reducing government spending

What has prevented a significant rise in insolvencies in Central and Eastern Europe?

• Increased consumer spending

• Government moratoria and guaranteed loans

• Higher interest rates

• Reduction in corporate taxes

What role do banks play in strengthening corporate balance sheets?

• Brokering equity to companies

• Providing only debt financing

• Reducing interest rates

• Increasing loan amounts

What is necessary for creating an attractive investment environment?

• Higher corporate taxes

• More government regulations

• Reducing retail investment opportunities

• A favorable tax situation for investors

What limitation has the ECB imposed on banks?

• Limits on dividend payments

• Restrictions on loan amounts

• Caps on interest rates

• Bans on new investments

Why did the bank postpone its decision on dividend payments?

• Due to a lack of profitability

• To wait for more visibility on economic recovery

• Because of ECB recommendations

• To comply with new tax laws

What is the bank's outlook on its profitability for 2019 and 2020?

• Expecting losses in both years

• Profitable in 2019 but not in 2020

• Profitable in 2020 but not in 2019

• Profitable in both years