Funding Strategy

Erste Bank´s prime liquidity source is the large surplus of customer deposits the bank has due to its strong market position in Austria and the CEE countries where it is active.

in EUR million 31.12.2018 31.12.2017 31.12.2016 31.12.2015
Financial liabilities - held for trading 2,508 3,423 4,762 5,867
Deposits from banks 17,658 16,349 14,631 14,212
Deposits from customers 162,638 150,969 138,013 127,946
Debt securities issued 29,738 25,095 27,192 29,654
Miscellaneous liabilities 5,381 6,535 7,027 7,257
Total equity 18,869 18,288 16,602 14,807
Total 236,792 220,659 208,227 199,743

Debt Structure as of 30.06.2019

The growing international activity of Erste Bank led it to develop alternative sources to the classic primary funding through customer deposits. The bank employs a wide range of funding sources and programmes to meet the funding requirements of the Group, its subsidiaries and the Austrian savings banks. The bank is active in Austria and internationally as a private placement issuer as well as making public issues in varying currencies, maturities and structures. The largest portion within securitised debt is made up of mortgage covered bonds which respresent ca. one third, followed by senior and tier 2 notes. The mentioned seniorities constitute approximately 90% of outstanding bonds.

Amount of debt increased in Q2 19 as Erste Group issued non-preferred senior and covered bond.

Maturity Profile as of 30.06.2019

Erste Group aspires to keep a constant redemption profile  to prevent above-average refinancing peaks in certain years.

Erste Group came with 2 inaugural issues in May 2019. Erste Group issued a 15yr mortgage covered bond, being the Bank’s longest syndicated EUR benchmark. The EUR 500mn transaction priced at MS+7bps and had attracted orders of EUR 3bn.

The second bond was Erste Group’s inaugural non-preferred senior issue, the EUR 500mn 7yr transaction priced at MS+80bps and the order book peaked at EUR 2.3bn.