With the merger, Nova KBM consolidated its position of the most accessible bank in the country, providing its clients with excellent products and services through the largest business network of more than 900 touch points (including branch offices, post offices, specialised banking offices, and ATMs) and the award-winning online and mobile banks, Bank@Net and mBank@Net, proven to be the best ones in the country. Nova KBM received the Superbrands title for the second year in a row, ranking the Bank among the top 1 % brands in Slovenia. At the end of last year, independent experts of the Institute for the Development of Social Responsibility presented the Bank with the HORUS Award for its strategic management of social responsibility. In March 2021, the Bank refreshed its corporate image, which retained the name Nova KBM, while symbolically and visually linked the features of the former two, now merged banks. Primož Roglič, the Slovene cycling champion, together with Lora Klinc, his life companion and author have become merger’s ambassadors.
Nova KBM started 2020, when the entire world was paralysed by the pandemic, in good shape, and it quickly and efficiently responded to the health and economic crisis. We ensured protective measures for our employees and clients, and complied with regulations issued by competent institutions to contain the epidemic. We provided our clients with smooth access to our services, raised their awareness of the use of digital banking, and remained a reliable partner even in the changed economic situation. Through donations and humanitarian actions, we demonstrated our solidarity with individuals and groups most affected by the pandemic. We maintained our strategic partnerships and continued sponsorships in the field of sports, culture, and education. This is the way we contributed to the development of a wider social environment, which is particularly important in these difficult times.
The Nova KBM Group ended 2020 with a profit of €210.8 million
Sustainable profitability is an important goal of the Nova KBM Group, as it enables investment in further development, while providing adequate reserves to adapt to future changes in the financial and economic environments. The Nova KBM Group, which in addition to the Parent Bank includes Summit Leasing Slovenija, a leading leasing company in the country, ended 2020 with net profit of €210.8 million, and Nova KBM generated net profit of €208.9 million. As a result of the largest merger in the history of the banking sector, the bank's balance sheet also increased compared to 2019. At the end of the financial year 2020 the total balance sheet of Nova KBM amounted to €9,167 million and of Nova KBM Group at €9,177 million.
At the end of the year 2020, the achieved return on equity after taxation was 21.59 % at the Group level and 21.42 % at the Bank level. The capital adequacy ratio remains high, namely 20.68 % and 16.67 % for the Nova KBM Group and the Bank, respectively. The results show a strong capital and good liquidity position of the Nova KBM Group. Activities in the field of non-performing loan management were also very successful. At the end of 2020, the share of non-performing loans in the portfolios of the Nova KBM Group and the Bank stood at 3.05 % and 2.50 %, respectively.
The Bank closed the 2020 financial year with the ratings that reflect both the performance of the Bank and the situation in the international financial environment. The Moody's Investors Service rated Nova KBM at Baa1/P-2 (stable outlook), while Fitch Ratings rated it at BB+/B (negative outlook).
In 2020, Nova KBM continued reducing its portfolio of non-performing loans and strengthening high standards of corporate governance, compliance, and risk management.
Digital transformation and sustainable development are among priority areas
Digital transformation, which has been additionally accelerated by the COVID-19 pandemic, remains a priority development area in Nova KBM. We provide our clients with excellent digital services, while keeping personal relationships and professional support offered by our banking experts. In 2020, following the modernisation of the core banking system in 2019, we further simplified some processes. We also introduced new services, such as a mobile wallet, online chat, virtual business unit, and upgraded the Contact Centre platform. In 2021, we supplemented these services with opening a personal account, account for young people, and concluding the Komplet bundle entirely remotely. Through these services, we provide our clients with the best user experience and support even without visiting a branch office in person. Moreover, we continued the digitalisation of work processes and the implementation of paperless operations in branch offices and other banking units in 2020. As a result, we saved more than 17 tonnes of paper compared to the previous year and, therefore, it significantly improved our impact on the environment. For the fourth year, in addition to the Audited Report, Nova KBM published its Report on Sustainable Development and Social Responsibility, which covers activities and achievements of the Bank in this area, and describes its development vision related to introducing ESG (Environmental, Social, Governance) aspects into our operations.
John Denhof, President of the Nova KBM Management Board: “In the challenging year marked by the pandemic, we made significant progress in pursuing the business strategy we had set up. We completed the largest merger in the history of Slovenian banking, designed common values of the Merged Bank, updated the brand, and carried out numerous other important projects. All these achievements result from a dedicated work of all employees of the Nova KBM Group and from the trust of our clients, for which we are thankful to everyone. Achieving a high level of trust and satisfaction of important stakeholders of the Bank and realisation of the business vision ‘To be the best bank in Slovenia’ will remain the focus of our operations in the future.”
Andrej Fatur, Chair of the Nova KBM Supervisory Board: “The Merged Bank continues its development path of a financial institution that is profitable, modern and socially responsible, and an excellent partner to its clients, business partners, suppliers, and a wider social environment. Our focus on Growth and Profitability, Client Excellence, effective Risk Management and Compliance, Operational Efficiency, and a strong organisational Culture and Talents remain the key pillars in realising our mission and vision.”
