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Pärnu Finantskonverents 2012 - Uus normaalsus
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Society Oriented Banking
Lars PehrsonCEO, Merkur Cooperative Bank, Denmark
Pärnu Finance Conference, Estonia, 19th April 2012
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Who is Merkur?
We are a cooperative bank, that combines
classical bankingwith
a vision of a sustainable society
Who are we?
Founded in 1982 Mainly owned by our clients 4 branches in the main cities of DK 75 employees More than 19,000 clients Balance sheet > 260 m EUR. We grow 15-25% per year
Classical banking
Deposits and loans
No capital market funding
We only finance clients activities in the real economy i.e. no speculation
Societal Vision
Production and energy procurement must be based on long term and sustainable strategies.
Social responsibility that all people can live and work with dignity
Cultural diversity and optimum conditions for developing skills and creativity
What do we finance?
Organic farming and food processing Renewable energy and energy savings Cleantech production Housing and work places for marginalized
groups. Culture, healthcare and education
institutions Limited activities related to developing
countries, like Fair Trade finance
Transparency
What does your money finance while deposited in the bank? Your money as a means of
impacting society in a sustainable direction Detailed information about the
loan portfolio on the websitewww.minepengegørgavn.dk
Main stream banking tendencies
Shareholder value philosophy creates short term focus The bank is a business like any other
business This business model promotes
transactions instead of relations
Society oriented banking
Community bankingFinance for the benefit of the local community. Financing of SMEs, farmers, housing etc.
Microfinance banks and MFIsBanking to reduce poverty and create livelihoods.
Environmentally and socially oriented banksA value based banking model that takes environmental sustainability, social justice and cultural freedom and plurality into account.
Environmentally and socially oriented banks
Classical banking combined with a vision of a sustainable society.
Exclusively linked to the real economy - nospeculation.
Maximizing sustainability and societal impact, not maximizing profits.
The banks are profitable at a fair and stable level. Average target around 7% ROE.
Transparency is key. Social banks publish their loan book!
Some important banksv
Name Country Asset Size 2010 (in USD millions) ABS Bank Switzerland 1,079 Banca Etica Italy 992 Banco Popular Costa Rica 2,646 BRAC Bank Bangladesh 1,478 Caisse Solidaire Desjardins Canada 617 Charity Bank United Kingdom 105 Cultura Bank Norway 72 Ekobanken Sweden 63 GLS Bank Germany 2,452 Merkur Bank Denmark 303 Mibanco Peru 1,587 Triodos Bank The Netherlands 4,641 VanCity Credit Union Canada 14,474 TOTAL 30,509
A Danish example sustainable production
Thise Dairy, Denmark organic dairy, founded 1988 by 8 farmers difficult market in the beginning today leading organic dairy in Denmark 65 farmers and a turnover of 95 m USD created > 150 jobs in a region of Denmark
with low employment rates
A Danish example social initiative
Hertha Village Community, Denmark community integrating mentally handi-
capped and normal people, from 1996 workplaces for handicapped adults, incl.
organic farm, small dairy, workshops etc. Living communities for handicapped and
individual houses and flats for others. Today > 120 people live in the village
A business model for Estonia?
Yes, absolutely!
Create a new bank Transform an existing bank, step by step Values have to be at the core of the
business model, not an add-on. Become part of an international
movement
Important networks
Global Alliance for Banking on Values www.gabv.org 15 value based banks Combined balance sheet exceeds $26 billion 7 million customers in 20 countries
INAISE www.inaise.org Global financial network, banks and non-banks
FEBEA www.febea.org European network for alternative banks
