Fortis, the Belgo-Dutch banking and insurance group, told an analysts’ conference last week that it wants to expand by acquisition in Europe.
According to Reuters, Chief Executive Jean-Paul Votron said on Friday that each business division of Fortis is being charged with drawing up growth plans to raise net operating profits by at least 10% a year – excluding any acquisitions – from 2005 to 2009.
“In addition to double-digit organic growth, selective acquisitions and partnerships will help Fortis to secure a strategic position in Europe,” said Votron, a former Citigroup banker who replaced Anton van Rossum in October last year.
According to the report, analysts and investors said they were disappointed that Votron’s strategy appeared to be one of continuity from the van Rossum regime. Some wondered openly how the group planned to achieve its double-digit growth target.
Votron says commercial and private banking will be the driver of Fortis’s European expansion. He wants the group to make at least 30 percent of its net operating profit before capital gains from outside the Benelux region by 2009, compared with 15 percent now.
Fortis makes three-quarters of its revenues from insurance operations, but 80 per cent of its core earnings from banking. Votron intends to expand its merchant banking and commodity finance services across the group.
In addition to the Netherlands, Belgium and Luxembourg, the group has operations in France, Germany, Ireland and Poland.