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By Boris Groendahl and Alexandra Schwarz
VIENNA, Sept 30 (Reuters) - A lack of bank financing, not
demand, is the main factor holding back construction projects in
emerging Europe at the moment, the region's biggest builder
Strabag told the Reuters Central European Investment Summit.
Board member Thomas Birtel, who oversees Strabag's building
and civil engineering business, said that a lot of its customers
in Poland had promising plans that they could not realise
because of a lack of bank funding.
"We have a lot of customers who have convincing ideas
because the deficit in the CEE countries - for instance Poland -
in private infrastructure is so obvious," Birtel said, citing
shopping malls in medium-sized cities as example.
"It is convincing that they believe such a project could
become successful also these days but what they are saying to us
is that they are having a problem to get the financing means
from the banks," he said.
His remarks contrasted with those of the region's top banks
speaking earlier at the Reuters Summit, including Unicredit
<CRDI.MI>, Raiffeisen International <RIBH.VI> and OTP <OTPB.BU>,
which all said that the reason for stagnant loan books was weak
demand, rather than restrictive credit policies.
Birtel said the only country for which the situation was
different was Russia. Russian banks including Sberbank
<SBER03.MM> and Bank VTB <VTBR.MM> have slowly started to grow
loan volumes again in return for state aid they received.
"We see (financing picking up) for Russia. There are certain
banks which have certain links to the Russian Federation who
seem to be more ready to finance projects than before," he said.
"But in all countries where the banking sector is privately
driven we see that they are still very, very cautious."
RUSSIAN HOPES RE-EMERGE
Strabag, which has some 4 billion euros ($5.9 billion) in
output per year in emerging Europe, once hoped to double its
output in Russia every year after Russian magnate Oleg Deripaska
bought a 25 percent stake in the company in 2007.
But the financial crisis scuppered those plans and it now
expects its annual output there to remain flat at around 400
million euros per year. Instead, Poland rose to become the
company's second-biggest area, overtaking Austria.
However, Strabag has now become more optimistic about its
chances of work on projects related to the 2014 Winter Olympics
in the southern Russian city of Sochi. []
Birtel confirmed Strabag expected this year's output and
operating profit to be largely unchanged from 2008. For 2010, he
said he expected "no dramatic changes" in either direction.
Strabag, which had gone on a spree of acquisitions until the
end of last year, is not in a buying mood at the moment, but is
digesting the deals it had done in the past, Birtel said. That
would not rule out selective deals if opportunities arose.
(For summit blog: http://blogs.reuters.com/summits)
(Writing by Boris Groendahl; Editing by Rupert Winchester and
Erica Billingham)
