Éva Hegedüs

Éva Hegedüs

Chairman-CEO of Gránit Bank

Finance / Hungary

Digital innovation sends Gránit Bank on steady ascent

Chairman-CEO Éva Hegedüs discusses Gránit Bank‘s priorities and avenues of growth.

How would you describe your positioning within the Hungarian banking sector?

In 2010, there was a genuine professional debate about the viability of a fully digital bank. We commenced our journey amid the global subprime crisis. Our subsequent performance attests to the feasibility of this strategy. We achieved profitable operations earlier than the international benchmark, boasting an average annual growth rate of 50%.

What innovations did you introduce?

Our core objective revolves around continuously expanding our suite of convenience services. Leveraging the ubiquity of smart devices and internet access, we introduced a digital bank, while upholding traditional banking values such as conservative risk and liquidity management.

Our unique business model rests on two pillars: digital retail innovations and conservative lending activities for small- and medium-sized enterprises (SMEs) and corporate clients. We eschewed the costly construction of a branch network and instead concentrated on digital banking solutions. Our mission is to offer comprehensive financial services in a simpler, more convenient, and faster manner, facilitated by digital solutions. We gradually diversified into the retail sector to broaden the bank’s deposit structure. Personal contact remains paramount in banking, hence our introduction of video banking services in the early 2010s, enabling clients to open accounts remotely via video chat or selfie. Over 90% of our retail customers opt for these digital channels.

Recognizing the pivotal role of mobile phones, we developed the Gránit eBank mobile application, featuring daily banking, foreign exchange, savings, PFM, insurance and advanced security functionalities such as card locking and real time limit adjustments, as well as parent-child mode. Our slogan “My mobile is my branch” encapsulates our commitment to seamless digital banking. Moreover, we spearheaded the digitization of mortgage processes, streamlining the entire lending journey through a fully online mortgage loan application. While legislative constraints prevent contract signing via the platform, the entire process leading up to it is easily managed within the app.

How embedded is sustainability in your DNA?

In 2021, Gránit Bank pioneered the introduction of the Mastercard Carbon Calculator in the mobile app, becoming one of the first banks worldwide, and the first commercial bank, to do so. This tool allows customers to track the carbon footprint of their spending and offset it by planting trees. Our digital banking model inherently promotes sustainability by obviating the need for an extensive branch network, thereby reducing travel requirements for customers. As a bank, we advocate for a sustainable economy, financing renewable energy projects and promoting efficiency initiatives for corporate and retail clients.

What are your main drivers and avenues for growth?

Initially, our loan portfolio was limited, yet we consistently outpaced industry growth averages. Our competitive edge lies in expeditious decision-making processes. Operating from Budapest allows us to streamline decision-making without bureaucratic impediments. Our business model ensures fast growth, high liquidity, and cost-effective operations, translating into enduringly favorable conditions for customers. Pricing is pivotal for both corporate and retail clients, and our structure enables us to offer competitive rates. By avoiding the hefty costs associated with branch networks, we reached an outstanding return on equity above 29% in 2023. This cost advantage enables us to provide favorable pricing for loans and deposits, a key factor in attracting and retaining customers.

What are the big priorities on the international agenda?

Our foremost objective is to enhance shareholder value through sustainable and balanced business growth and profitability. Building on our established digital strategy, we aim to fortify our market position. We are expanding our investment services and private banking offerings, integrating them with our digital solutions to capitalize on evolving market trends. Roll-out of digital banking value proposition to other markets is relatively easy; we are poised to expand internationally, initially targeting countries with Hungarian minorities. As the Gránit Bank brand gains traction, we envision serving a broader European and global clientele.