BAWAG to cut costs despite first profit in years

BAWAG PSK (BAWAG) boss Byron Haynes has said he will continue the current restructuring process.The former ABN AMRO CFO announced yesterday (Weds) BAWAG had to keep lowering its administration costs in the coming years.The Vienna-based institute achieved a net profit of 125.4 million Euros last year, the businessman added. It is the first time BAWAG is in the black since the institute was taken over by US investor Cerberus Capital Management (Cerberus) in 2007. The American company acquired a major interest in BAWAG for 3.2 billion Euros as the bank faced bankruptcy after having suffered immense losses. Several former managers were convicted in court in Vienna for their involvement in controversial investments.Haynes said yesterday Cerberus was a “good shareholder”. The BAWAG chief said he was convinced the US firm had no plans to stop its engagement in the bank.The businessman’s statement comes after former Social Democratic (SPÖ) Finance Minister Hannes Androsch claimed Cerberus may withdraw “in the foreseeable future”.Haynes said yesterday BAWAG – which received 550 million Euros of state aid since 2009 – had total assets of 38.6 billion Euros in 2010, down by 6.5 per cent compared to 2009.BAWAG is Austria’s fourth-biggest bank. It has around 1.6 million customers.The financial institute sold 35 Delka shoe shops it owned to shoes and leather products company Salamander last month. The bank currently possesses 70 Stiefelkönig shoe stores across Austria. Haynes said yesterday the sale of these shops should be finalised this summer.BAWAG has been rumoured to be in the running for becoming a strategic partner of struggling Volksbank AG (ÖVAG) for weeks last year before the ÖVAG announced there would be no merger. Haynes ruled out any kind of cooperation with the rival yesterday.