Investments in IT and Economy of Ukraine: Interview with Board Member of Credit Agricole Bank

NV Травень 2024

In May, Credit Agricole Ukraine celebrate its 31 years in Ukraine, at the same time, Crédit Agricole Group has been present on the international market for 130 years. How the bank manages to keep the leading positions throughout the period of its work in Ukraine, how the full-scale russian invasion affected Credit Agricole operations, which areas are in focus now and more was explored in our interview with Oleksandr Kurkin, Director of Proximity Banking and Network of Credit Agricole.

ー In May, Credit Agricole Ukraine celebrated turning 31 years old. Which of the latest events in the course of the bank’s operations seemed the most remarkable to you?

ー For me as Director of Proximity Banking and Network, the fact that the bank keeps investing in the outlet network has been among the most significant ones. Recently we opened our largest new format Client Journey outlet in San Francisco business center, located in the capital city. Such outlets first came into being in 2018, and our customers took a fancy to them. Convenient space zoning, separate area for premium customers offer maximum comfort and confidentiality.

With our new outlet in San Francisco business center we went above and beyond and created a hub with a full set of competencies, and it has become a kind of compact banking business center, the unified outlet that receives all types of customers – individuals, entrepreneurs, representatives of large multinational corporates, etc.

Maintaining continuous personal contact with our customers is among our priorities that we are able to implement on the high level thanks to our awesome team. In San Francisco, we have 11 banking services and finance management experts. Therefore, let me take advantage of the opportunity and invite you all to visit the new Credit Agricole outlet in Kyiv, located in San Francisco business center.

ー What are the advantages for the IT entrepreneurs offered by Credit Agricole, considering the new work trajectories of the bank?

ー The IT is doubtlessly among the biggest industries in Ukraine currently. According to the Ministry of Digital Transformation, more than 500 service companies and about 1,700 product companies work in Ukraine. After the start of the full-scale invasion, the Ukrainian IT industry faced numerous challenges. In order to support the growth of the IТ and private entrepreneurs, we launched our Code of Trust project. It is a comprehensive solution helping IT pros and companies to conduct business effectively. At the same time, it meets the individual needs of developers, accountants and business owners in Ukraine and abroad.

We are confident that the IT industry will keep growing and now it is essential to provide more comprehensive high quality services for its representatives. Now our IT companies have offices in many countries, so international presence and experience of Credit Agricole Group enable us to clearly anticipate the needs and requirements of our customers having offices both in Ukraine and abroad.

Even before the full-scale war IT industry has been among the key development focuses of Credit Agricole. In France, where Credit Agricole comes from originally, this area is very well-developed. There, the bank has its own in-house accelerator Le Village and makes significant investments in the development of innovations.

ー Have you identified any factors that are a prerequisite of success for both the international bank and the Ukrainian branch of the bank?

ー The prerequisite of success is our customers and their loyalty that have enabled our expansion and growth throughout the years while remaining solid. Another one is Crédit Agricole’s approach to risk management. It is what helps us support our customers on the one hand while remaining a transparent bank with impeccable reputation globally and a high quality loan portfolio on the other hand.

Last but not least, support from the international Group is paramount. Crédit Agricole top managers visit Ukraine to support our Ukrainian team in person, while the Group invests in various business projects and allocates the funds to support the society. Given the extraordinary context, the shareholder decided to fully preserve the results obtained over the past 3 years in the bank's capital in order to support the Ukrainian economy and participate in the future reconstruction of the country.

Due to the serious stress test during COVID-19 pandemic, we found ourselves partially prepared to the full-scale invasion which has unequivocally become the direst crisis since Credit Agricole started operations in Ukraine. We prepared for all possible scenarios, arranged virtually seamless remote work for our employees, have not paused for a moment and kept supporting customers even in the occupied territories.

Workloads on our contact center and ATMs was exceedingly high, it was what we prepared for in advance and replenished our ATMs with extra cash funds. Eventually we noticed that our customers did not give in to the panic and kept their funds in the accounts with the bank. In a way, our customers also helped Credit Agricole to overcome this challenging period. The volume of customer funds in our bank keeps growing, which is a testament to satisfaction and trust from our customers.

ー How has the war affected the functionality of the bank, the number of operating outlets, taking into account the de-occupied territories?

ー Credit Agricole outlet network has been quite stable for years and we never downsized it. Despite the war and the significant area of the occupied territories in Ukraine, we maintain personal contact with our customers and offer services nationwide provided it is feasible in terms of physical safety. We make effort to be in proximity to our customers, so we cultivate our network and even open the new outlets.

However, due to the objective reasons, we temporarily suspended operations of about 12% of our outlets located either in the occupied territories or areas with ongoing hostilities. Those territories include the cities of Kherson and Kupiansk, Zaporizhzhia and Donetsk regions.

At the same time, to replace the completely destroyed outlet in Borodianka, we quickly opened a new one after the city was de-occupied, so as to be present there and ensure our customers enjoy the level of service they are accustomed to. Today, safety is a major concern and Credit Agricole network will develop in locations where the lives of our customers and employees are not under threat.

We have been on the market for quite a while, and throughout the years we have demonstrated solidity and reliability of our banks, which is confirmed by the numerous ratings even in the wartime.

First, it is the loyalty of our customers: we have 385 thousand customers in Ukraine and 54 million customers of the Group worldwide. We aspire to cultivate the trustful lasting relationship with each of them. Support of the international group also plays an important role, it has especially come to the forefront now, in the wartime. Following the full-scale invasion, Crédit Agricole has immediately confirmed its intention to continue operations in Ukraine and established the 10 million euros solidarity fund to help the Ukrainian colleagues and those affected by the war.

We are a socially responsible bank, prioritizing contribution to the wellbeing of the Ukrainian society. Since 2016, as part of our corporate social responsibility program “We Care!” we regularly help children and hospitals. Since the start of the war, Crédit Agricole allocated UAH 142 million for charity and helping those affected by the war. These funds were used to buy the modern essential equipment for over 20 medical institutions nationwide and 2 specially equipped ambulances – basically “hospitals on wheels”

We also care for the bank’s team – no lay-offs, salaries raised three times since the war broke out and additional financial compensations. These are Crédit Agricole values that remain unchanged for nearly a century and a half.

Speaking of the financial indicators, in the latest five years we doubled our capital, which enables us to finance the economy and participate in its recovery. The bank is also performing great financially, thanks to which based on 2023 results our total amount of all taxes and duties paid was UAH 3.3 billion. 

For the entirety of 31 years of operations on the Ukrainian market, Credit Agricole is pursuing the crucial task of living up to the confidence placed in us by our customers and society at large.

ー What does Credit Agricole place more emphasis on the development of online services or expanding the outlet network?

ー We have motto “100% digital and 100% human”. We observe the market trend of going completely online, at the same time we believe and know from experience that our customers also look for personal trusting relationship and the option to meet face-to-face.

At the same time, we are investing a lot in IT development - the IT investment budget in 2024 has doubled compared to 2023. In the wartime, we offered the option to open an account remotely for individuals and private entrepreneurs. We also have the СА+ mobile application, which is top-rated based on Apple Store and Play Market customer feedback. Additionally, 70% of the active customers of the bank and 97% of employees use the СА+ app, which is a great indicator of trust in the product.

Not so long ago we have completed the migration process of all our legal entity customers to our internet bank “CORPEX ”, which is a heart of the daily banking for legal entities. In 2023, Credit Agricole received recognition as the leader in cash management on the Ukrainian market according to Euromoney, which attests to the high quality of service both in the outlets and remotely. During the war, we also launched the new internet bank CA+ Pro for private entrepreneurs and for IT entrepreneurs first and foremost, who are part of our strategic segment of customers.

ー What are the strategic development trajectories of the bank on the retail market specifically?

ー Granted, the automobile industry is at the top. Credit Agricole is among leaders having 28% automotive lending market share in Ukraine. We have partnered up with 15 vehicle manufacturers and offer exclusive lending terms for several popular brands.

We are also developing the premium banking while remaining a universal bank that serves with all segments of customers. Our business lines and teams of the bank work in synergy in order to provide our customers with the comprehensive range of services and some of the best offers on the market.

Prior to the war, we developed cash loans, however we were forced to temporarily halt this service. This year, we have been gradually resuming financing, granting new cash loans, credit cards. So far, we are moving fairly slowly, as the risks of the war are still looming. Being a bank with the exceptional reputation, we care for all our customers, namely ensuring the safety of funds on the deposit accounts of our depositors. For this purpose we must adhere to the policy of prudent risk management. We cannot jeopardize our solidity, which we gradually earned during the 31 years of operations in Ukraine.

We have always been resilient to any fluctuations of the economy thus confirming our status of a reliable bank, we always honour our commitments to the customers.

ー What are the main goals the bank has set for the nearest future?

ー At first, we developed a 5-year strategy until the year 2025, but when the war started, we updated it. We have become more flexible to respond to the market changes and are updating our short-term tasks and objectives. It is Сredit Agricole values that remain unchanged.

In 2022, it was of essence to stabilize all the processes, understand how to work further, which countries/cities our customers and employees are moving to, how we can help them. The year 2023 was marked by resumed financing on the retail market, development of the automotive lending, cooperation with legal entities, etc.

Now the growth of all commercial portfolios remains our priority. We will keep supporting both large agrarians and small farms, developing car lending. Regarding the Credit Agricole objective to reduce carbon emissions, our customers can also look forward to special lending terms for electric vehicles.

We also have ambitious plans for the IT industry: this year we want to become the bank that serves all IT business segments. The new Code of Trust project will help us with this goal. We want more than just working with legal entities, freelancers or salaried workers. Our objective is to serve the entire industry as we are confident that it will promote the development of the Ukrainian economy as a whole.