Hypo Group Alpe Adria

1. General information about Hypo Group Alpe Adria

Hypo Group Alpe Adria is an international financial group with more than 380 banking and leasing locations in twelve European countries: Austria, Italy, Slovenia, Croatia, Bosnia-Herzegovina, Serbia, Montenegro, Germany, Hungary, Bulgaria, Macedonia and the Ukraine.

The group has a rich historical background. Roots of Hypo Group Alpe Adria date way back in 1896 when the group was founded. Consequently, it has accumulated more than one hundred years of business experience. In the beginning of its activities, it concentrated on financing public institutions and housing construction. Hypo KA¤rnten - as it was then known - became a universal bank in 1982.

In 1988 the Bank took the first step on the road to international expansion by opening a leasing subsidiary in Udine, Italy. It became a public limited company in 1991, and in 1992 Grazer Wechselseitige Versicherung joined the Province of Carinthia as the second shareholder. This marked the beginning of a new era for Hypo Alpe-Adria-Bank.

With cross-border activities in twelve countries of the Alps - Adriatic region[1], the Hypo Group Alpe Adria has a unique position in the economic area constituted by South Eastern Europe. Its network of branches and offices exists in Austria, Italy and Germany, from Slovenia through Croatia, Bosnia-Herzegovina, Serbia, Montenegro, Macedonia, Hungary, Bulgaria and the Ukraine.

Business priorities in the operations of Hypo Group Alpe Adria are the strategic business sectors - banking and leasing, with the focus on a common goal: contribution to the prosperity of the Alps - Adriatic region and of the people living in it.

Hypo Group Alpe Adria is committed to pursuing its goal of becoming the leading commercial bank in the Alps - Adriatic region.

1.2. Mission and Strategy

The mission of the Group is the following: instead of pursuing global presence as a goal, Hypo Group Alpe Adria is more locally oriented. In the Alps to Adriatic region, with its cross-border markets, it is local market knowledge at a very personal and emotional level, which is crucial. Personal contact with the customers represents the basis of mutual trust for the Group. For this reason the Group sees its relationships as partnerships, which extend far beyond simple money issues. According to the Group, success can only be achieved through human contacts, and it can only be measured in terms of personal relationships, so that partnership at a personal level is the Group's ultimate ideal.

Hypo Group Alpe Adria leaves the goal of worldwide presence to the global players. As a leading regional player in the Alps to Adriatic area, it concentrates on the southeastern markets, with the motto "banking business is people's business", confirming its nonnegotiable customer orientation. Respecting differences, growing together and sharing successes with others - these are the cornerstones of partnerships with customers on which the business structures of the Group are based.

Having in mind that the fundamental strategy of the Group is to achieve growth in the Alps to Adriatic region, Hypo Group Alpe Adria has been pursuing its visionary strategy since 1993 with great success: to establish and develop a strong financial services Group in the Alps to Adriatic region which combines the highly developed Northern Italian, Germany and Austrian business cultures with growth market opportunities in Hungary, Slovenia, Croatia, Bosnia - Herzegovina, Serbia, Montenegro, Bulgaria, Macedonia and the Ukraine. As a result, the Group plays a key role in directing funds and economic development to and in the region. Up till now, its successful expansion has given Hypo Group Alpe Adria intensive coverage of the areas, which in coming years will become its home markets.

Additionally, long - term involvement and commitment are priorities of the Group. Hypo Group Alpe Adria has established itself as a strong and reliable business partner in the Alps to Adriatic region. Its involvement in each country represents a long - term commitment, so that businesses operating in any of these countries have the certainty and security they need in order to develop their activities. The Group is actively involved in developing local economies, and consequently, this contributes to the foundations of local prosperity.

Furthermore, preserving independence and regional identity is one of the cornerstones of the Group's philosophy. This fact gives customers and business partners the certainty that they are handling their business with a dynamic and internationally minded bank which at the same time is at home in each of the individual regions. Hypo Group Alpe Adria is close to its customers in all the countries it operates in, thanks to its emphasis on independence and un-bureaucratic decentralized structures.

1.4. Regional presence of Hypo Group Alpe Adria

It is important to underline that the expansion of Hypo Group Alpe Adria into its core market, the Alps to Adriatic Region, followed gradually. The establishment of the first Austrian bank branch in Vicenza (Italy), under EU law followed with Austria's accession to the EU in 1995.

In the same year leasing companies were established in Ljubljana (Slovenia) and Zagreb (Croatia). In the upcoming years further leasing outlets were opened in Slovenia and the expansion of the branch network in Italy and Croatia.

In 1997 the number of staff at Hypo Group Alpe Adria went over the barrier of five hundred employees, accompanied by the start of construction of the present Klagenfurt (Austria) headquarters, which was completed in three phases by 2002.

By the beginning of the new millennium, Hypo Group Alpe Adria already employed over one thousand people. In the following year it entered the market in Bosnia and Herzegovina.

In 2002, Hypo Group Alpe Adria's expansion penetrated into the market of Serbia and Montenegro. The Group's dynamic progress continued in 2003, when it was announced as investor of the year in Bosnia and Herzegovina, opened a leasing branch in Munich (Germany), founded the Biogaspark Alpe - Adria and launched tourism initiatives in Carinthia (Austria), starting the Schlosshotel Velden project. Hypo Group Alpe Adria is today active in Austria, Italy, Croatia, Slovenia, Bosnia and Herzegovina, Serbia, Montenegro, Germany, Hungary, Bulgaria, Macedonia and Ukraine. In 2005 it numbered approximately 5000 employees at over 250 locations.

The year of 2006 has been extremely important for the Group and it conducted strategically important expenditure decisions. It founded Hypo Alpe - Adria - Bank a.d. in Podgorica (Montenegro), Hypo Alpe-Adria-Rent d.o.o. in Belgrade (Serbia) and Hypo Alpe-Adria-Leasing OOD in Sofia (Bulgaria). The principal company of Hypo Group Alpe Adria is Hypo Alpe - Adria - Bank International AG, which has its head office in Klagenfurt (Austria). Its owners are BayernLB (67.08%), the GRAWE group (20.48%), KA¤rntner Landesholding (12.42%) and Hypo Alpe - Adria Mitarbeiter Privatstiftung (0.02%). The network of Hypo Group Alpe Adria currently has around 7,500 employees serving more than 1.3 million consumers.

2. Hypo Group Alpe Adria in Serbia

Hypo Group Alpe Adria conducts its business activities in Serbia from 2002, as a part of the Hypo Alpe - Adria - Bank International AG Klagenfurt, which originally operated only in the territory of Austria. In the past couple of years, the Group began with its dynamic expansion in the international market, which consequently resulted in great success: the Group became one of the most successful financial institutions in the Alps - Adriatic region, with approximately 7500 employees and more than 1.3 million clients in twelve countries.

"When we arrived to the Serbian market, we made a thorough analysis of finance, economy and legal sector, as well as the political situation of the country, based on which we have determined that Serbia will become one of the most important countries in our network. Serbia has enormous potential and we plan to invest in this country in the future and to become one of the leading financial institutions of the country." (Markus Ferstl, former Chairman of the Management Board of the Hypo Alpe Adria Bank a.d. Beograd)

Having in mind that Hypo Group Alpe Adria`s strategic business sectors are banking and leasing, the Serbian market was firstly penetrated in the leasing sector. Leasing represents a relatively new form of financing in the Serbian market. Therefore, a leasing company bearing the name Hypo Alpe Adria Leasing d.o.o., was established in 2002, and it gained a leading position from the very beginning of its activities.

The company remained the leader till present time with a cumulative market share of 35.19% in all segments of financing. Hypo Alpe Adria Leasing d.o.o. Beograd currently employs 136 people in affiliating offices throughout Serbia, including Belgrade, Novi Sad, Cacak, Niš, Subotica, Sombor, Zrenjanin, Becej, Vršc, Šabac, Kragujevac and Kruševac.

Additionally, not long after the establishment of Hypo Alpe Adria Leasing d.o.o. in Serbia, the bank by the name Hypo Alpe - Adria - Bank a.d. Beograd was founded in 2002. In just eight moths of business operations in Serbia, the newly founded bank achieved a growth rate of 853%, which exceeded all expectations. Hypo Alpe - Adria - Bank a.d. Beograd is currently one of the top five financial institutions in Serbia, with a market share of 8.55% and first-class and diversified portfolios. Additionally, it employs more than 800 people and has developed a rich business network consisting of affiliates in almost all bigger cities in Serbia, taking into consideration the headquarters of the company located in Belgrade, in the Business Center "Usce" where the other member companies of the Group are located[2].

Hypo Alpe Adria Securities a.d. Beograd was founded in 2004. The company is ranked among the top five broker companies in the market of shares and of old savings bonds trading.

The youngest company of the Group is Hypo Alpe Adria Rent d.o.o. Beograd, which is the first financial institution in Serbia to offer the possibility of operational leasing for the clients.

During the present research, special focus will be on the bank and the leasing company operating in within the system of Hypo Alpe Adria Group.

3. Hypo Alpe Adria Bank a.d. Beograd

In order to proceed with the research on Hypo Alpe Adria Bank a.d. Beograd, it is necessary to explain the circumstances in which the banking sector in Serbia existed from 1990s till present time.

Disintegration and collapse of socialist Yugoslavia in the beginning of the 1990s announced the so-called "lost decade", meaning that major structural features and weaknesses of the banking system were preserved or additionally deteriorated and the overall situation became desperate. The main characteristics of 1990s were losses of markets, repeated wars, economic sanctions and international isolation of the country. Mismanagement and pervasive corruption were main factors, which contributed to the degeneration of the economy. After the major hyperinflation, which occurred in 1993 and 1994, 90 % of all bank loans were perceived as bad. Unprofitable and non-performing foreign currency balance sub-balances dominated balance sheets.

One of the main priorities in the reform agenda of the new Serbian authorities, which took over in 2000 was bank restructuring. The essence of the strategy was to undertake bank rehabilitation and re-capitalization only in the cases when it was expected that the banks could be viable institutions with good prospects for privatization through sale to strategic investor at a reasonable price and only if it can be implemented with identifiable fiscal resources.

In the beginning of 2002, Serbian authorities decided to conduct one of the boldest bank resolution measures undertaken in transition economies: they liquidated four large and deeply insolvent banks, which accounted for 60% of the book value of the sector's asset and for about two thirds of outstanding commercial credit to non - financial sector. Furthermore, banking legislation and regulations were improved[3].

After the first major wave of reform, credit institutions have become more attentive in lending money to the real sector which was still very week. The government immediately acted on attracting foreign investors since there was an urgent need for such a thing. Consequently, from the late 2000 to December 2002, National Bank of Yugoslavia (the central bank) issued eight bank licenses, out of which seven were for the foreign owned banks.

Internationalization and privatization of the Serbian banking industry continued in 2005. The share of the market accounted for by foreign banks rose to 67.52%. Out of the ten largest banks, seven are foreign.

Successful sales of Serbian banks to foreign financial institutions provided a vigorous stimulus to the country's banking industry. Total assets of all banks in 2005 jumped by 40.4% compared with the previous year, to 9.07 billion euros. Strong increases in lending to private and business customers were the main forces, which were driving growth. Progress was also made in restoring the confidence of domestic savers: total deposits at the end of 2005 amounted to 5 billion euros. Foreign banks which penetrated the Serbian market played an important role in restoring confidence in the sector and have gathered a significant share of new deposits. One of these banks was Hypo Alpe Adria Bank a.d. Beograd.

Hypo Alpe-Adria Bank's involvement in the Serbian market began in December 2002, when it acquired Depozitno-kreditna banka. The Austrian bank concluded the purchase of 86.6% of the Serbian Depozitno-Kreditna Banka, founded May 22nd 1991, whose registered offices were in Belgrade. At the shareholders' meeting held on October 8th 2002, the Bank's name was changed to Hypo Alpe-Adria-Bank a.d., the capital increase to EUR 5.5 million was resolved, and the new Supervisory Board was appointed.

The headquarters of to Hypo Alpe-Adria-Bank a.d., the member of the Hypo Group (after Austria, Italy, Slovenia, Croatia, Bosnia-Herzegovina and Liechtenstein), are located in the new part of Belgrade - New Belgrade.

Referring to total assets, Hypo Alpe-Adria-Bank a.d. is Serbia's fourth-largest bank with a market share of 6.47 %. Furthermore, approximately 900 employees are currently working for the Bank in a total of forty-one branch offices throughout Serbia.

Market share of top five banks in Serbia (Source: National Bank of Serbia available at https://www.nbs.rs/export/internet/latinica/50/50_5.html)

After just several months of its operations in Serbia, the Bank has established itself as a recognizable part of the Serbian financial scene. In its first two years of its activities, Hypo concentrated on corporate customers. The Bank has achieved a particular competitive advantage in the corporate sector with its long-term investment lending. Efforts to develop private customer business began in 2004. The specific focus gradually switched to the housing construction market, which was performing excellently.

"When we arrived to the Serbian market in 2002, we were among the first ones and there had been only six foreign banks operating in the market. We have used that window of opportunity, the situation when there had been few foreign banks present, in order to develop our credit portfolio. In that period, we had the opportunity to finance some of the most successful companies in Serbia, as well as to develop well-balanced portfolio, which we diversified over the years. Special attention was dedicated to retail sector, mostly in the field of house loans. Additionally, we have formed a special unit for financing of small and medium sized enterprises and this has become one of our corporate priorities, having in mind that these companies are often suppliers and partners of the big companies we already cooperate with. Other than that, our focus is on food industry, agriculture, pharmaceutical and chemical industry." (Vladimir Cupic, Chairman of the Management Board of the Hypo Alpe Adria Bank a.d. Beograd)

The Bank is organized in the following sectors and departments:

1. Corporate sector
2. Retail sector
3. Sector of financing public enterprises and local community units
4. Treasury sector
5. Investment banking
6. HR department
7. Economic analysis department
8. Sector settlement
9. Market support sector
10. Logistics sector
11. Sector of organization and information technology
12. Legal department
13. Department of business control harmonization
14. Marketing department

The research process will only incorporate the sectors, which are relevant for the research question of the thesis.

3.1. Corporate sector

From the very beginning of its operations in Serbia, the Bank has established an extremely developed corporate sector, which quickly expanded in the sense of different departments within the sector, as well as the number of employees. The corporate sector of Hypo Alpe Adria Bank quickly achieved competitive advantage in comparison to other banks in Serbia.

Various departments are organized within the sector:

1. Credit department
2. Small and medium enterprises (transferred to the Retail sector in 2006)
3. International financing

Products and services of the corporate sector are concentrated on the client and its needs, and include the following:

• Investment loans (loans approved for the purpose of purchase of machines, equipment, land, real - estate)
• Framework loans (exceeding permissible minus on the account, eskont of bills and revolving lines)
• Documentary operations (guarantees, credits, purchase of receivables and inkaso)
• Loans for working capital

Till 2006 Hypo Alpe Adria Bank mainly focused on long - term corporate loans, which were given to the big corporate clients. Since then, it strategically refocused on small and medium sized enterprises and expanded its offer of products.

Corporate sector is known for its extremely innovative products and services offered to the clients. The innovation, which was introduced by the Bank in the market of Serbia, is the so-called "cross - border" financing. This type of financing is dedicated to the clients that operate in more than two countries. The financing capital is actually provided from outside Serbia and offered to the clients under much better conditions than the ones, which are present in the Serbian market. Additionally, the Bank provides special guarantees for the clients within the Hypo Group, and in this way supports their business activities in other countries.

Furthermore, another product, which is particularly innovative, was introduced in 2004 and it is called the revolving line. By using this product, clients are automatically enabled to use other additional products, according to their needs (dinar and foreign currency loans, working capital loans, guarantees etc.). The revolving line can be used by big corporate clients, as well as small and medium sized enterprises and entrepreneurs.

Being a strategic branch of the Serbian economy, agriculture is one of the top priorities of the corporate sector. The Bank has been extremely active in financing agricultural production: individual agricultural manufacturers have the possibility to finance basic and working capital.

Cross - selling activities refer to the presentation of bank's products from other sectors within the Bank.

Acquisition of new clients also represents one of the fundamental operations of the corporate sector. It is particularly important since it is the basis of the planned growth of deposits, as the fundamentals for the primary sources.

Special attention within the sector is dedicated to project and structural financing, like: financing of projects for the market or long - term exploitation, purchase of shares, mergers / acquisitions of companies.

3.2. Human resource (HR) department and relationship towards employees

HR department of Hypo Alpe Adria Bank was established in May of 2003 and has developed its activities at a very rapid pace, due to the fact that the number of employees was increasing intensively.

In the very beginning of its operations in Serbia, the bank had a total of 27 employees and in just one year the number increased to 323 employees. In 2005, the growth trend continued and the number of the bank staff reached 531 people. Finally, on the closing date, 31 December 2008, Hypo Alpe-Adria-Bank a.d., Beograd had 871 employees. The increase of the number of employees is the result of the extension of the branch office network. Furthermore, additional employees were recruited in the headquarters to cater for the increasing customer demands. Within the initial process of selection and engagement of young experts, 600 potential candidates have been interviewed. Furthermore, database containing more than 1500 biographies of interested candidates was created, which points out to the fact that young people of Serbia are very keen on participating in the creation of modern multinational companies.

One of the key priorities of the HR department from the very beginning of its existence was to enable quick integration of new employees into the system. Secondly, the Bank immediately started with the implementation of the Hypo standards, creation of the corporate identity and team atmosphere in the institution.

Additionally, a very important strategic goal for the department was to become the source of educational staff, which would be capable of taking on new jobs, initiatives and development. In that sense, many of the employees, who have already acquired standards of the corporation and business modalities, have obtained leading positions within the Bank as the heads of various sectors.

As far as the age structure is concerned, majority of employees of the Bank belong to the age group 30 - 39 years old, as it is shown in the diagram below. Additionally, 47% of all employees have acquired university education, while 33% of employees have secondary education.

Activities of HR department are focused in three directions: administration, finance and education.

In the area of administration, the department is handling recruitment process and hiring of new people who are competent and can contribute to the environment of the Bank.

In the field of finance, the so called "time - management" program is being implemented within the department, referring to the planning of the budget which will be used for the purpose of staff education and various bonus systems realized through completed targets.

Having in mind the fact that, contemporary flows of banking operations worldwide demand constant education of the staff in all areas of the business, HR department takes particular notice of education of employees.

The department is conducting educational trainings in various forms: motivation trainings, special skills development courses and language courses. This contributes to the raising of the efficiency level of the staff. Educational trainings are organized internally and externally. Some of the most important types of trainings, depending on the sector are:

• Cross - selling courses
• Microsoft Office Excel seminars
• Insurance trainings, which enables the participants to obtain the license of the insurance mediator
• Small and medium sized enterprises trainings
• Seminars for the sale of pension and investment funds
• CDO`s and Credit linked trainings
• Specialist courses MCPD and MCITP Database Administrator for staff in the sector for informational technologies
• System Oriented Management course 1 and 2
• Optional modules
• Top executive Education
• Public Finance Basic Training
• Project management - Train the Trainer
• Project Management for Top Management

Cross - selling courses for account managers are particularly important for the activities of the Bank, in order to introduce existing clients of the Bank with new products and services. In this way, account managers tend to ensure that the additional product or service is being sold to the client, while at the same time enhancing the value the client gets from the Bank.

Moreover, employees have the opportunity of expanding their knowledge in seminars jointly organized in cooperation with relevant public institutions, such as the National bank of Serbia, Association of Banks in Serbia, Serbian Chamber of Commerce, Institute for Business research and other external providers, as well as trainings related to international accounting standards.

Having in mind that the Bank operates in twelve countries and that everyday communication involves the use of foreign languages, English courses are provided for all employees, at the expense of the Company. Additionally, certain numbers of employees who occupy the positions, which are directly linked to the headquarters of the Group in Austria, take courses of German language, whose expenses are also borne by the Company.

Particularly relevant project of the department was realized in 2008, when the Bank established its internal employee - training center. The main goal of the project was to make the best possible use of the existing knowledge and the practical experience of the staff. The center was formed in order to initiate internal transfer of knowledge among employees, information sharing, better communication, which consequently leads to better work performance and improvement of inter-personal relations within the Bank. This modern and completely technically equipped space is intended for internal and in - house trainings, seminars and workshops for employees. Additionally, several types of trainings are conducted within the Center: cross - selling workshops, "Hypo - 1" - a tool which helps the staff get acquainted about other sectors besides their own, small and medium size enterprises trainings, etc. In just three months after its opening, more than 400 employees have participated in organized trainings, and in one year more than 900 employees successfully passed over 30 internal educational and development programs of the center, which consequently justified the original expectations set by the management of the Bank.

In addition, there is no doubt that one of the key priorities of the Bank is employee satisfaction. HR department in Hypo Bank actively conducts the employee assessment programs, which are incorporated in the employee satisfaction program. Originally, the program was based on yearly interviews of employees and their superiors on the subject of work efficiency and success, through self - evaluation done by the employee, and the evaluation obtained from the superior. In order to upgrade the program, in 2007 HR department decided to introduce new actions.

One of these actions was employee satisfaction survey. This type of survey is conducted among all employees in the end of every working year, and concentrates on the four most important areas of employee satisfaction: general satisfaction with work and work conditions, communication and interpersonal relations, leadership, bonus systems and career opportunities. Achieved results from the survey serve as the basis for strategy planning for the upcoming years. This is particularly important in order to include the opinion of the staff in the process of future strategy defining and decision - making, so that everyone can benefit from it. Furthermore, obtained results were than given to the HR agency Advance Response International that deals with HR issues, and in this way anonymity and objectivity of the research was achieved. At this point, it is necessary to highlight that Hypo Bank has developed cooperation with several human resource agencies for the purpose of various types of trainings: project management, leadership and management, credit and market risk, etc.

Asides from the efforts, which are focused on the improvement of communication among employees, inter-personal relations and management, the management of the Bank puts special emphasis on professional development of the middle and top management members. For that purpose, development center operating within the HR department was established in order to assess development necessities of the staff belonging to these levels of management. The center analyses results of interviews, surveys and supervisors suggestions, and consequently creates individual development plan for every employee. Another type of development plan created in the center, is team development plan, which is implemented on the entire teams working in specific sectors.

"In order to do business well, you need to have products of good quality, but asides from that, you need to have excellent staff. Therefore, we invest a lot in education and training of our employees. For example, in the second quarter of 2006, we realized a special trainee project. We hired motivated young people who had just completed their university education and we enabled them to pass specific trainings throughout the entire Group in two years, in order to get familiar with every aspect of the company business activities. They didn't have trainings only in Serbia; they also visited other Hypo companies abroad. As we often like to say in the Group: our greatest assets are our employees and for that reason we will continue to invest in their internal and external education." (Marija Sutanovac, Head of the HR department of the Hypo Alpe Adria Bank a.d. Beograd).

Important point, which should be highlighted in this section, is opportunity for scholarships for university education of employees. Each year Bank supports further education of thirty selected employees and provides funding for their studies. This program represents a special kind of acknowledgement for talented and hard - working employees. Furthermore, in cooperation with the Serbian Business Club "Privrednik[4]", the Bank provides scholarships for ten students, which are not employees of the bank, and in this way shows its support directed to the young people of Serbia. In this way, talented and perspective students have the opportunity to be in touch with the people from the most significant and influential companies in Serbia, and can find employment opportunities upon their graduation asides form their scholarships.

3.3. Marketing department and relationship towards clients

Marketing department had a challenging task of providing support to all business activities of the Bank, once it penetrated the Serbian market. The key priority of the department was to create a positive image of the Hypo Bank, as well as to inform the Serbian population about its products and services. Corporate image strategy emphasized values of the bank: its tradition, innovative approach to business, Alps-Adriatic philosophy based on the regional banking client focus, partnership, security, corporate responsibility and independence. The main focus of the department was to create and promote the corporate image, which emphasizes that Hypo Alpe Adria Bank a.d. Beograd takes care of its clients in the same way as it takes care of its employees, and that it is a reliable partner who nurtures the local community in which it exists.

The main element of the department's strategy was to create two-way communication with the clients: to reach the clients, and to hear their needs as well. For that purpose, the Bank introduced a special program called clients suggestions. Clients of the Bank have the possibility of sending their suggestions, comments, as well as complaints to the Bank's products and services via the company website or special telephone line, which was introduced for that purpose. The department then analyses the feed back from the clients and responds in the shortest possible notice, or directs the clients to other departments, which can provide them assistance. This concept was implemented not only in Belgrade, but also in all other towns in Serbia where the bank has its branch offices in order to enhance the process of building positive corporate image.

Additionally, more actions were taken in order to improve the dialogue with the clients. For example, in December 2005, in cooperation with an outsourcing marketing agency, the department conducted a big survey called client satisfaction survey and all clients who wanted to participate, have been included in it. The Bank does this type of research once a year. Once the research is completed, department analyses obtained results. Consequently, this leads to constant quality upgrading of products and services, as well as other areas, which are perceived as the ones that need to be improved.

Big marketing project was launched in 2008 under the wing of big promotional campaign called All under one. The purpose of this project was to offer existing clients as well as potential ones, much better conditions than normally applied for some of the bank's products like savings and loans. In addition, in order to simplify the procedure, special website was created where all interested parties could download the list of necessary documentation, together with the forms. The action lasted three months and resulted in the increase of the number of new clients.

"We are putting all of our efforts to come up with innovative promotional campaigns for every year, which will be interesting for our existing clients, as well as potential ones. For example, the name of our advertising campaign in 2008 was "Give your Dreams a chance". During the campaign we tried to pass its key message, which is that we developed ourselves across the borders and are well prepared for supporting our customers in realizing their dreams. The campaign is on air in all 12 countries of the Hypo Group and once more emphasizes on our intention of thinking in networks in the extended Alpine-Adriatic region. Today, this region is not only our market, but our home. (Marina Vujicic, executive of the Marketing department of the Hypo Alpe Adia Bank a.d.)

In fact, majority of the marketing department activities are directly linked to the participation in the local community development through advertising campaigns, sponsorships, donations, promotional material and very intensified PR activities, which will be elaborated in more detail in the upcoming chapter.

3.4. Local Community Contribution

Being a big and successful company, Hypo Alpe Adria Bank has a high sense of responsibility for the local community and individuals living in it. Top management of the bank is well aware of the fact that success can be achieved only if the company hears and respects the needs of others. As it has been previously mentioned, from the very beginning of its operations in Serbia, the Bank had a strategic orientation towards the long - term presence in the local community, which consequently refers to the local community contribution.

Marketing department takes actions of nurturing and supporting the most vulnerable social categories of the Serbian society, which are children and young population, in the first place.

Majority of the projects of particular importance are oriented towards investing in young population in order to provide everyone equal chances for good quality education.

For example, with its donations, the Bank participated in the following projects:

1. Renewal of the Institute for neurology and psychiatry of children and young adults. In this project, facilities of this important medical institution have been completely renovated in order to provide better ambience for the patients, as well as for the medical personnel working in it.
2. Upon the opening of its new branch in Leskovac, the Bank decided to join the educational program launched by Telekom Srbija[5] in order to raise the level of educational quality in cities other than Belgrade. For that purpose, the Bank donated twenty computers to the local school.
3. The Bank made a donation of fifty computers, printers and necessary accessories for children without parents and parent care, which are living in Children's Village in Sremska Kamenica. Furthermore, the Bank traditionally donates financial means to the Village every year, in the annual amount of 1.5 million dinars. So far, financial means have been used for the purchase of vans and busses for the children.
4. Project "Scholarships for the best" in coordination with the Ministry of Work and Social Policy. The main purpose of the action is to show responsibility towards the most jeopardized members of the community - high school students and college students, who regardless to difficult living conditions, achieve fascinating results during their studies, together with their active participation in sport events and social activities. Hypo Bank provides scholarships for one hundred disabled children in the monthly amount of 150 euros.

Additionally, in cooperation with the Graduate School of Economics (Belgrade University), the Bank supported promotional activities of the AIDS control program in Serbia.

In order to set a positive example for other socially responsible companies and raise the level of corporate responsibility, Hypo Bank initiated yearly program for its employees for volunteer blood donations in cooperation with Blood Transfusion Institute of Serbia. The Bank went one step further: it founded its own Association of voluntary blood donors, which has over one hundred members. Therefore, the Association responds to the appeals of the Institute for blood transfusion whenever the stock of blood units reaches the minimal level. Within the Association, the club of organ donors was founded in 2008.

In this way, management and employees of the Hypo Bank give their contribution to the health system and promote the culture of voluntary blood donation in general, which sets a positive example for other companies operating in Serbia.

Sponsoring cultural and sports events is another form of good practice the Bank established within the marketing department. Some of the most significant events supported by the Bank are:

• Belgrade Fashion Week
• Good Year Basketball League
• International Cycling race "Through Serbia"
• Tennis Association of Serbia and many others.

Raising awareness of sport significance in Serbia was one of the strategic goals of the Serbian authorities in the last couple of years. Therefore, Hypo Bank decided to coordinate its own marketing strategies with the state ones. In 2007, all marketing activities for the advertising of bank's products and services have been realized through the sponsorship of Novak Djokovic, Serbia's best tennis player. This step resulted in two side success: on one side, the bank's image was linked to the success of the famous tennis player and everything he represents, and on the other side, rich and interesting media campaigns for credit cards, loans and other services of the bank with the face of Novak Djokovic in them, influenced the awareness of people living in Serbia about values of sport success.

In 2007 the Managing Board of Hypo Alpe Adria Bank a.d. Beograd decided to establish the Sector for public enterprises and local government financing.

The sector has two departments:

1. Department for local community units.
2. Department for public enterprises.

The main goal, which is set by this act, is the intention of the Bank to participate in financing of local government projects and public enterprises, which are to be realized in this segment. Having in mind the fact that for the past twenty years there had been no investments in the public sector of Serbia, as well as the fact that it is inevitable that the Government will intensify and support the activities of public enterprises and local municipality units, the Bank recognized the opportunity to actively participate in the process and to offer its services to these units. Therefore, the Bank established contacts with 100 local municipalities throughout Serbia and in the end of 2008, approximately 40 million euros of financial means have been placed by the Sector for public enterprises and local government financing, out of which 27.3 million euros have been placed in the public enterprises and 12.7 million euros to the local municipality units.

The most significant placements were made to the most important public enterprises in Serbia: NIS[6] (Petroleum Industry of Serbia) and JP Srbijagas. Additionally, placements were made to the various ministries of the Government of the Republic of Serbia.

In December 2008, Hypo Alpe Adria bank participated in several government tenders: Univerzijada 2009, Corridor 10 and JP Srbijagas. Tenders for Univerzijada 2009[7] and JP Srbijagas[8] have been resolved positively for the Bank.

Through its innovation model of project financing, which represents a completely new form of financing in the Serbian market, the Bank was chosen to finance the construction of facilities for one of the biggest student sports competitions in the world - Univerzijada 2009. Univerzijada 2009 represents one of the major projects financed by Hypo Alpe -Adria - Bank a.d. Beograd, and at the same time it is the largest project in the real estate market of Serbia. In fact, it is the infrastructure project of the construction of the University village in New Belgrade's Blok 67 for the purpose of this big sports competition. Once the sports competition has finished, apartments are free for further sale on the market. Total area of the university village covers the space of 75,318 m2 and contains the following facilities: residential buildings which contains 1778 housing units, office buildings which cover the area of 19.581m2, elementary school complex of 1600m2 with the ground for sports activities, combined facility for children's institution, the total area of 1600m2 and center for the elderly persons. In this way Hypo Alpe-Adria-Bank became one of the first banks in Serbia, which provides investors the ability to realize different types of projects through the model of project financing, which has long been available in the developed capital markets.

It is important to underline that the other project in which the Bank participates is currently in progress, and is carried by JP Srbijagas. The project refers to the development of the gas pipeline in Serbia and envisages building high-pressure gas pipeline and development of gas distribution networks. Estimated value of investments for the construction of high-pressure gas pipeline in the overall length of 470 kilometers is around 82 million euros.

3.5. Infrastructure, technology and transportation development

Development in the area of infrastructure and technology is particularly noticeable in the case of Hypo Alpea Adria Bank a.d. Beograd. Logistics department is the one, which takes pride in the obvious results, since all investments in office facilities, work material and equipment, as well as transportation system are handled through it. In fact, logistics department has been divided into three sectors:

• Sector for investments
• Sector of office business
• Security service

Sector for investment is responsible for handling all investments and coordination of projects of new branch offices establishment.

Sector of office business takes care of providing all necessary supplies for the needs of the Bank. Furthermore, it is in charge of the purchase and maintenance of vehicles, handles postal errands, as well as information desk services.

Security service is relatively independent and its main responsibility is to provide security services of satisfactory level to employees and clients of the bank.

Hypo Alpe Adria Bank a.d. invested approximately 25 million euros in the construction and renovation of its office space in the past five years. The bank was established in 2003 and at the time, it constructed 2000 square meters of headquarters facilities on the periphery of the Serbian metropolis. It should be taken into account that the building, which was used for this purpose, is the building of the old Central Committee of the former SFRJ, which was deteriorated during bomb intervention by NATO in 1999 and was completely out of use. Headquarters of the Bank represent, by the opinion of many, the most prestigious and best - looking business facility in Serbia. Hypo Group occupies the first ten floors of the building: branch office of the bank is located in the ground floor, various bank departments are situated from 1st to 7th floor, Hypo Consultants and Securities are located on 8th floor and finally, Hypo Leasing offices are on the 8th floor. The building has exceptional strategic position in the proximity of the rivers Sava and Danube, just next to Belgrade's most important traffic streets, close to the city center were all significant companies have their representative offices, and it is well linked to the airport.

In just five years, the Bank expanded its network of offices and warehouses and now occupies a total area of 20.100 square meters throughout Serbia. The rapid growth occurred due to the intensive branch offices establishing, meaning that forty-one branch offices and five objects for other means have been opened on forty-six locations in the territory of Serbia.

Parallel to the extension of the branch network, development of transportation system also followed, together with development of systems for technical maintenance of objects, systems for bank file archiving, as well as construction of big warehouse space for the needs of the Bank.

All facilities are equipped according to the standards of the Hypo Group: equipment of the newest technology. All offices are air - conditioned and newly furnished. Majority of branch offices have been renovated, particularly in Central Serbia, since they were in relatively bad shape, having in mind that this part of the country is less developed in comparison to Belgrade and Northern Serbia.

As far as technology is concerned, particular emphasis is put on the enhancement of possibilities for the existing informational technologies, as well as for the development of new technologies, in order to provide internal users and external clients efficient and good quality products.

In the beginning of 2004, several internal solutions have been implemented:

• Complete automatization of work creating procedures
• Development of application protocols
• Catalogues of products and services
• Application for success assessment
• Internal revision system
• Data bases of treasury sector

Additionally, development of intranet network began in 2005. This project has been of particular importance and for its main goal it had the upgrading and improving of internal communication between employees, as well as enhancing of business processes. Intranet platform provided obvious contribution for all employees as it enabled them with simple access to all significant information of the Bank. Furthermore, it offers all necessary and useful information starting from the most important news, what is new in the bank, who are the new members of the staff, internal announcements for job opportunities within the Group, important information about employees, for example, their positions, telephone numbers, birthdays, etc. Additionally, intranet contains information about all member companies of the Group, links to their official websites, as well as currency exchange list.

It is important to mention that the Bank implemented one of the world's most modern contemporary banking software - Temenos 24. Temenos 24 is an international leader in banking software packages in the last five years. Its development through its application in a great number of facilities has rendered this system capable of covering the most specialized banking needs. It represents an integrated banking package which automates all banking work, meaning that the software is capable of covering all operational requirements of the bank with regard to Retail, Wholesale, Treasury and Private Banking for front, middle and back offices.

Furthermore, the Bank implemented international procedures for the support of the IT operations and business processes with the implementation of Information Technology Infrastructure Library. This has been incredibly important, particularly in cases when changes need to be made in the central system, for the easier handling of responsible staff.

Another innovation in the field of technology is File net software. It is a software, which helps enterprises manage their content and business processes. It offers functionality and is capable of being customized to manage a specific business process. Implementation of the software improved the quality and safety of the bank's business operations in the field of saving more data in the data bases, contents of transactions, work flow, contents of the network, and others.

Electronic banking is another innovation, which has been introduced by the Bank from the very beginning of its operations in Serbia. This strategy was very well accepted, consequently leading to the situation that other banks in Serbia implemented it.

"In the beginning of our operations in Serbia, we have emphasized the importance of electronic banking. Internet banking is mostly used by our corporate clients and represents a much simpler and cheaper way of dealing with financial issues of the company, instead of waiting in lines in the facilities of the banks. However, our retail clients do not use this service very often, since people like to see who they are dealing with and personally meet the employee of the bank. Therefore, in my opinion the most important form of banking business when retail sector is concerned is a branch office. In spite of this, our bank needs to offer the service of electronic baking, due to the certain number of clients who will have the necessity for its application and we were among the first banks in Serbia to do so." (Aleksandar Gajic, Head of the Logistics department of the Hypo Alpe Adria Bank a.d. Beograd)

In 2005, the bank started with the implementation of the Triple S project, which for its main purpose had the introduction of the new front-end program solution in order to offer support to the sectors of retail, corporate and market support affaires, as well as operational businesses.

Also, Dinamic center for bank data has been constructed and consolidated, with the high level of server virtualization. This innovation helps achieve better efficiency of the processor's capacity, as well as to the better redundancy and safety of the entire system.

Significant upgrading of the IT architecture have been implemented, such as: MPLS technologies of Telekom Srbija, which directly contributed to the quality of communications; solution for the network traffic control for all branch offices, as well as for the headquarters of the Bank; PBX networking - implementation of the IP telephony; finalization of the WAN project group, and finally, implementation of the print security system.

Transportations system consists of fifty new vehicles of different types and sizes, which are used for the needs of the bank. Vehicles are mostly used for transportation of the training staff on the occasions of openings of new branch offices, as well as equipment transportation for the same reason.

3.6. Culture preservation

As it has been stated earlier, the mission of the Hypo Group Alpe Adria is to be locally oriented, instead of pursuing global presence as a goal, as well as to preserve independence and regional identity. For that reason, the company's primary focus is the Alps - Adriatic region, with its cross-border markets, where local market knowledge is highly required. Personal contact with the customers represents the basis of mutual trust for the Group. For this reason the Group sees its relationships as partnerships, which extend far beyond simple money issues. The main ideology of the Group is based upon the presumption that success can only be achieved through human contacts, and it can only be measured in terms of personal relationships, so that partnership at a personal level is the Group's ultimate ideal.

Additionally, Hypo Group Alpe Adria's motto "banking business is people's business," confirms its nonnegotiable customer orientation. Respecting differences, growing together and sharing successes with others - these are the cornerstones of partnerships with customers on which the business structures of the Group are based.

The management of the Hypo Group Alpe Adria is very careful when it comes to cultural characteristics of its employees in Serbia, as well as clients and business partners. The particular emphasis is put on the Serbian language. Members of the top management who come from Austria have Serbian language lessons every morning before work, even though they can handle their business communication in English language. The reason for this, as it has been explained, is the development of better communication with the domestic staff and partners.

For example, during my first two years in Serbia, I had to do a lot of fieldwork since we were a newly established bank, which had to acquire clients and gain trust among the Serbian population. I was traveling all over Serbia and visiting potential clients, get to know them and talk to them. Some of them were big companies who had factories in their ownership, with the local workers working in them, who have very little knowledge about the English language. While speaking in English was customary in Belgrade, in other parts of Serbia the situation was somewhat different: majority of the business people I visited spoke no English, we needed the help of the translator in order to understand each other more easily, which made the entire business concept more difficult for us, since we were seen as people coming from another country. I started with my Serbian lesson several months upon my arrival to Belgrade and in one year I could see that the effort did pay off. I forced myself to address the people I was visiting in Serbian language, and even though I made mistakes, they found it funny, corrected me and we gradually developed warmer and more friendly relationship. (Markus Ferstl, former Chairman of the management Board of Hypo Alpe Adria Bank a.d. Beograd)

Serbia is known as a country with specific culture traditions, particularly referring to the concept of "slava[9]" when families celebrate their patron saints day in their family homes. The employees of the Group have one day off on these occasions and in this way the company wants to show that it respects their traditional days. Furthermore, the Group respects all festive occasions, which are foreseen by the legislation acts of Serbia

Particular subject of the cultural issues is the occasion of Christmas holidays. Having in mind that people working in the Bank belong to the Orthodox and Catholic religion and consequently celebrate different dates of Christmas, each year one celebration is organized firstly in the end of December, just before the Catholic Christmas holidays and another in January for the Orthodox staff. All employees are invited to both of these events, which are organized in a Serbian manner, with Serbian music, either traditional folk music or popular domestic music bands.

HYPO ALPE - ADRIA - LEASING D.O.O. BEOGRAD

4. Hypo Alpe-Adria-Leasing globally

The Hypo Group Alpe Adria Leasing's business operations began in 1990 in Klagenfurt, Austria. From the very beginning of its activities, the team, which managed the company and consisted of few people, had a big vision: to position leasing as a dynamic form of financing at an international level, particularly in the largely undeveloped markets of the Alps-Adriatic region. At the same time, these markets were sensitive areas, where the political and economic situation was increasingly spiraling out of control, which as a result had the Balkan War, ultimately leading to the disintegration of Yugoslavia.

In a way, the vision of Hypo Group Alpe Adria Leasing could be seen as a mission for peace. This situation occurred due to the fact that, at the time, young financial group was among the very first enterprises, to penetrate into each of the Balkan countries after the end of the military action and establish locations, in this way significantly contributing to the reconstruction and peacekeeping processes. Therefore, the confidence placed in the region and their people has contributed to the creation of the powerful foundation for the entrepreneurial success of the Hypo Group Alpe Adria Leasing in the Balkan region, where it is currently the market leader.

Hypo Group Alpe Adria Leasing is present in seventy-seven locations and employs more than one thousand employees throughout the Alpine - Adriatic region. This company offers complete leasing services and expertise for vehicles, aircraft, ships, real estate (operation plants, retail centres, schools, hospitals, residential and energy projects) and equipment (office and operation equipment, industrial plants, etc.), and has acquired more than 72000 clients. The key element of company's success is quality of consultancy services and cross-border expertise offered by the committed staff of the Hypo Group Alpe Adria Leasing.

Since 2003, Hypo Alpe - Adria - Leasing Holding AG, a subsidiary of Klagenfurt - based Hypo Alpe-Adria-Bank International AG, has been coordinating international companies as fully owned subsidiaries. Additionally, preference shares were issued to a chosen category of persons. Due to excellent performance in its current markets, the main goal of the enterprise in the upcoming years will be to continue expansion into Central and Eastern Europe in the coming years.

The key element for success of Hypo Group Alpe Adria Leasing in the Alp - Adriatic region was introduction of innovative products, usage of tax possibilities, as well as cooperation with big international partners form the area of motor vehicles, company vehicles and machines.

4.1. Hypo Alpe-Adria-Leasing d.o.o. Beograd

Leasing represents a relatively new form of funding in Serbia's capital markets and can be defined as a three - party legal work: the leasing company (lessor), the user object of the lease (the lessee) and the supplier. In this transaction, the lessor buys the leased asset from the supplier, and gives the asset to the lessee for a particular time period, who is in turn obliged transfer periodic payments to the lessor, under the terms defined in the leasing contract.

In fact, Hypo Group Alpe Adria Leasing was the first leasing company, which penetrated the market of Serbia and introduced the following financing innovations:

• Real Estate Leasing
• Vehicle Leasing
• Equipment Leasing

Real Estate Leasing represents a modern type of financing which combines advantages of lease and property, without encumbering the client's credit line. In this way, private persons, companies and institutions can realize construction projects without problems.

In the last few years, leasing has become an indispensable alternative to the traditional loan transactions for businessmen and local authorities globally. Asides from providing tax advantages, this type of financing provides liquidity- and collateralization advantages. The flexible arrangement of the maturity allows a tax-optimal adjustment to the liquidity requirements. The Hypo Group Alpe Adria Leasing offers opportunities for financing options for the construction and purchase of office buildings and shopping centers, as well as for the acquisition of real estate and production facilities. Service package also encompasses tax and economic advantages and opens several possibilities in the area of construction management. Additionally, the experts of the Hypo Group Alpe Adria Leasing are offering their support to clients during the search for a location, public authority routines, subsidy applications, and construction negotiations.

Real estate leasing objects can be one of the following: office- and business facilities, garages, halls, shopping centers, trading centers, production facilities, warehouses, hotels, tourism, recreational resorts, pre-schools, schools, public buildings, residential buildings, and freehold apartments

Asides form the professional local support offered by the staff of the leasing company, advantages of this type of leasing are obvious. It offers simple and flexible processing, in comparison to bank procedures; tax advantages are obtained in this type of investment. Furthermore, the leasing deal improves the liquidity of the company or the individual.

Vehicle leasing represents another form of leasing offered by the Hypo Group Alpe Adria Leasing. The company provides its services and offers tailored solutions for all models and ranges of use in the area of vehicle leasing to all private persons and companies. In the process of acquiring a vehicle, it is not only the equipment, service and cost-effectiveness that are of importance, but also the optimal financing is of great importance.

Several modalities of vehicle leasing exist in the offer of Hypo Leasing:

Full-Pay-Out Leasing represents the contract in which the entire acquisition value is almost amortized to the full amount at the expiration of the contract. A residual payment remains after the end of the agreed upon contract period.

In the case of Partial-Pay-Out-Leasing the residual value represents the expected value of the vehicle at the expiration of the contract. Normally, the residual value relates to the residual book value. At the expiration of the leasing agreement, the residual value represents the basis for the sale of the vehicle or the extension of the existing leasing agreement. Both of these variants provide the option to reduce the employment of capital and the total financing costs by additional personal capital contributions, referring to the self-financing contribution. With advance rentals you make a non-recurring down payment and reduce the monthly leasing payments. Fiscally permitted down payments vary in each country and must not exceed a certain maximum amount of the acquisition value.

Objects which are a subject of vehicle leasing are automobiles, trucks, delivery trucks, trailers, transportation vehicles, buses, special vehicles, tractors, agricultural vehicles, construction vehicles, crawler-mounted vehicles, excavators, motorcycles, campers, etc.

Advantages obtained by the use of this type of leasing are cost transparency since the client receives all information regarding the contract. Furthermore, entirely free brand selection exists, which is followed by the simple and fast processing procedure. In the case of early termination of the contract, the company offers fair settlement of contract, and finally, leasing payments are tax - deductible as operational expenses.

In contemporary business world, machinery, technology, operational facilities and equipment represent major investments in the company's future. Flexibility is a central factor in the modern economic life. A major factor for a successful company strategy is the ability to quickly react to changes in the market situation.

Therefore, Hypo Group Alpe Adria Leasing in Serbia provides the ideal type of financing with the Movable Equipment Leasing, which allows the financing of investment goods without limiting liquidity of the company. At the time of acquisition, no costs occur to the company. The investment costs are earned in the form of leasing payments by the active business and repaid within the agreed upon maturity. Types of equipment financed in this way are industrial facilities, construction- and production machinery or business equipment and furnishings, business equipment and furnishings, practice equipment and furnishings, medical equipment, production machinery, industrial facilities, rolling stock, construction machinery, construction and structural engineering machinery, machine tools, special machinery and engine plants, with the only requirement that leasing object must be an economically independent unit and must represent a moveable capital good.

Advantages foreseen by this type of leasing contract are:

• Maintenance of liquidity - no equity commitment
• Leasing payments are immediately tax-deductible as expenses
• Improvement of the balance sheet ratios of the lessee if the financing is set to Off-Balance
• Leasing can expedite the fiscal amortization of the investment
• Quick and flexible investments in assets, machinery and business equipment and furnishings is possible
• Individual contracts that are tailored to the needs of the client
• Investment costs are distributed equally over the asset depreciation range

From 2003 and the implementation of the new the Financial Leasing Act, adopted by the Government of Serbia, the leasing market in Serbia started growing dynamically and became one of the fastest growing segments of the financial market. Penetration of new leasing companies was a natural consequence. In comparison to 2003 when there had been four leasing companies operating in Serbia, currently there are seventeen of them.

Hypo Alpe - Adria - Leasing d.o.o. Belgrade was founded in 2002 and operates as a member of the Hypo Group in Serbia. Since the establishment of Hypo Alpe - Adria - Leasing d.o.o. Beograd, the company became and remained the absolute leader in the Serbian market. As an evidence to support this claim, according to the official data obtained from the Association of leasing companies in Serbia (ALCS), from the day of its establishment in 2002 till the end of the first quarter of 2009, Hypo Alpe-Adria-Leasing is the absolute leader, with a cumulative market share of 36.3%. This successful market position acquired by the company lays on the fact that the Group made timely assessment of the market in Serbia. Furthermore, the advantages of the cross - border financing, previously mentioned, which offer the clients better conditions of financing, had significant impact, as well as the fact that Hypo Alpe - Adria - Leasing d.o.o. Beograd was generally the first company in Serbia to offer the possibility of financing via leasing.

If someone has a good idea, a good business plan and a market to sell, but not enough of funds, leasing can finance house building, machinery, with much less initial capital of the client, than is the case with the bank. Bank seeks security of their investments and rarely goes to work if that assessment is insufficient collateral. Leasing company would be easier to decide, because it would, in addition to securing the conditions envisaged for the financing, be the owner of land, the owner of the facility and equipment. (Christian Messner, Member of the management Board of the Hypo Alpe Adria Leasing d.o.o. Beograd)

The main focus of the company is on the leasing of motor vehicles for corporations, as well as for individuals, leasing of aircrafts and equipment. In fact, Hypo Alpe - Adria - Leasing d.o.o. financed the first aircraft lease realized in Serbia. Since 1st of January 2006, it has also been the exclusive provider of real estate leasing via its own subsidiary (Hypo Alpe-Adria-Rent d.o.o.).

From the start of its business activities in Serbia in 2002, the rapid growth of the Bank's personnel was followed by the growth of personnel working in the Hypo Alpe - Adria - Leasing d.o.o.. As it is shown in the diagrams below, expansion of branch offices resulted in employee growth. In the very beginning of its operations in Serbia, the leasing company had a total of 9 employees and in just one year the number doubled to 20 employees. In 2004, the growth trend continued and the number of employees reached 41 people. Particularly extensive employee growth continued in 2005, 2006, 2007. Finally, on the closing date, 31 December 2008, Hypo Leasing had 136 employees working in 13 branch offices.

4.2. Significant projects of Hypo Alpe-Adria-Leasing

In this case study on the Hypo Leasing, departments of marketing and human resource will not be analyzed since they are coordinated with the activities of the Bank and involve joint efforts in these segments. Instead, significant financing projects will be elaborated in more detail.

Relevant project, which was initiated in the end of 2008, is the cooperation between Hypo Alpe - Adria - Leasing d.o.o. Beograd and the European Investment Bank. These two institutions signed financial agreement, according to which the European Investment Bank approved Hypo Leasing the funds worth 50 million euros. The main purpose of this cooperation is to encourage sustainable development of the economy of Serbia. Benefits from the placement of funds that were approved by the contract, are directed towards the sector of small and medium enterprises in Serbia, where the investment funds are intended to go. The funds will be approved primarily and specifically for projects in the field of environmental protection, infrastructure development, development of economy based on knowledge, rational use of energy and development projects, health care and education, which represent the key points of development of the society and economy of Serbia.

Additionally, the first leasing contract in Serbia in the field of real estate leasing was concluded by Hypo Alpe - Adria - Rent d.o.o., a subsidiary of Hypo Alpe - Adria -

Leasing d.o.o. Beograd in June 2006, and related to the financing of business premises whose value amounted to the investment worth one million euros. Hypo Alpe - Adria -Rent d.o.o. started operating successfully in January 2006 and represents the part of the Hypo Group Alpe Adria, which deals with business lease (operational leasing) vehicles, property, fleet and vessels. This subsidiary financed several major projects in the field of real estate, including office building in New Belgrade (the scope of funding: 6.8 million euros), shopping mall in New Belgrade (the scope of financing: 16.1 million euros), construction of cars saloon in Zrenjanin (funding volume: 0.61 million euros). Current projects Hypo Alpe-Adria-Rent doo Belgrade are the financing of the construction of new showroom and in Belgrade, the value of 4.5 million euros, financing of the reconstruction of a mall in Novi Sad in the value of 9 million euros and financing the construction of commercial buildings in Bezanijska kosa[10] worth 30 million euros.

Furthermore, numerous relevant construction projects which the Hypo Alpe - Adria - Leasing d.o.o. and Hypo Rent Alpe - Adria - Rent d.o.o. finance are:

• Construction of the automobile showroom and service of the Vitro Group company, of the total area of 8000 square meters, in which Hypo Alpe - Adria - Rent invested 4.5 million euros.
• Construction of the Idea Extra shopping mall in Belgrade, of the area of over 12,000 square meters in which Hypo Alpe - Adria - Rent invested 16.1 million euros.
• Construction of the plant for the production of batteries for the company Farmakom MB, in which Hypo Alpe - Adria - Leasing d.o.o invested approximately 3.5 million euros.

4.3.Corporate responsibility

Following the corporate policy of the Group, which requires all its members to be socially responsible, Hypo Alpe - Adria - Leasing d.o.o follows the same example via various campaigns.

The company has joined the campaign to finance the purchase of Punto 188 cars, with subsidized interest rate for citizens of Serbia. In this way, Hypo Alpe - Adria - Leasing d.o.o joined the action launched by the Serbian government, which aims to enable citizens to buy new cars, as well as to help the domestic economy[11]. The attractive package of Hypo Alpe-Adria-Leasing offers the purchase of a new 188 Punto car with the nominal interest rate of 4.5% and the cost of treatment amounts to 0.5%. In addition, Hypo Leasing offers a special advantage: all 188 Punto customers receive a gift voucher for fuel for the first 1000 kilometers in a new car. Therefore, through participation in the action and a gift voucher, Hypo Alpe-Adria-Leasing meets the needs of its customers and continues its tradition of always known but attractive offers.

Additionally, from one year to another Hypo Alpe-Adria-Leasing participates in different humanitarian projects. In 2007, the company has given scholarships to the best students from foster families.

On the other hand, in 2008, it supported the project of UNICEF "School without violence". Realization of the program "School without Violence" began in 2005. UNICEF implements this program in collaboration with the Ministry of Education, Ministry of Health, Ministry of Labor and Social Policy, Council for Child Rights of the Republic of Serbia, Institute for the Advancement of Education. Since 2008 the program involved the Ministry of Internal Affairs and Ministry of Youth and Sports. The main objective of the "School without Violence" program is the creation of a safe and encouraging environment for learning, work and development. Hypo Leasing Company takes active participation in this project.

Furthermore, Hypo Alpe-Adria-Leasing made a "dream room" in the institution Jovan Jovanovic Zmaj, where children without parental care grow up. The project was implemented in collaboration with relevant Government institutions and is architecturally original. Modern rooms with technical equipment were constructed where children can create, discover, learn and prosper. In addition, successful people from all spheres of public life lecture on various occasions and organize mini - workshops.

Raising awareness of sport significance in Serbia was one of the strategic goals of the Serbian authorities in the last couple of years, as it has been previously mentioned. Therefore, in joint and coordinated efforts of Hypo Alpe Adria Leasing and Hypo Bank in Serbia, marketing strategies of both companies are harmonized with the state ones.

Therefore, in the end of 2007, the leasing company signed the sponsorship contract with basketball club "Partizan". By doing so, the company has joined the sponsor pool, which consists of the most reputable companies from Serbia and abroad.

Basketball club "Partizan" is one of the most recognizable sports brands in European and world basketball. It is the multiple champion of Yugoslavia and Serbia and Montenegro cups and the domestic cup winner, multiple winner of the European Cup "Radivoje Korac". Furthermore, the club was the European champion and the champion of Serbia and Montenegro cup five times in a row, and represents the club from which the numerous representative players of the team of Yugoslavia came, including nine players who became the members of the NBA teams.

4.4. Environmental protection - renewable energies

The climate change topic, CO2-reduction and the "Kyoto Protocol[12]" are omnipresent in our everyday life. Hypo Group Alpe Adria Leasing has been dealing with the topic of renewable energies for years, and gives its contribution to environment protection by financing heat production projects and energy production projects. The company became a reliable partner for operators and manufacturers in the area of renewable energy by obtaining the specific know how from this field. The financing is as important as the technology. The Hypo Group Alpe Adria Leasing is an experienced contact partner for several types of financing. In particular, several projects in the areas of photovoltaic, wind energy and biomass were successfully realized in Austria and Germany.

In connection with guaranteed feed-in tariffs, profitable long-term movable equipment leasing financing is realized with competent and adequate partners. The availability of the Hypo Group Network, which stretches across thirteen countries in Eastern and Southern Europe, the Hypo Group Alpe Adria Leasing opens new markets for operators and manufacturers. With its specialists on the spot that provide optimal financial and legal support, the Hypo Group Alpe Adria Leasing represents a competent partner. A fact of particular importance is the know how, which is provided by the employees and which flows into the respective projects during the planning and development phase, and allows the development and provision of an optimal financing concept for the prospective client via leasing or hire purchase. Financing focus of Hypo Group Alpe Adria Leasing is in the segments of photovoltaic, biogas, combined heat and power units, wind energy, hydropower and biomass.

As far as Serbia is concerned, a project of particular importance is carried out with joint efforts of the Hypo Bank in Serbia and in cooperation with JP Srbijagas. The project refers to the development of the gas pipeline in Serbia and envisages building high-pressure gas pipeline and development of gas distribution networks. Estimated value of investments for the construction of high-pressure gas pipeline in the overall length of 470 kilometers is around 82 million euros. This project is of national interest for development of gas - pipeline in Serbia.

5. Conclusion on the Hypo Group Alpe Adria in Serbia: Hypo Alpe - Adria - Bank a.d. Hypo Alpe - Adria - Leasing d.o.o

The analysis of experiences of Hypo Group Alpe Adria in Serbia, with the main focus on Hypo Alpe Adria Bank a.d. and Hypo Alpe Adria Leasing Beograd do.o. operating within the Group, was done in order to answer the research question of this doctoral thesis, which is the following: "Do multinational companies have a positive contribution to Serbia's socio-economic development and overall economic growth?"

The key questions, which were aimed to be answered, as set in the literature review, are the following ones:

1. What types of MNEs are currently operating in Serbia?
2. Do MNEs contribute to the employment increase of the local staff in Serbia?
3. Do MNEs improve managerial and entrepreneurial techniques and strategy of managers in Serbia?
4. In which way are MNEs introducing new business logics and pragmatism in the Serbian environment?
5. Which variables are influencing the success of MNEs operating in Serbia?

Question 1 has been answered in the chapter "Serbian environment for multinational investment" where the types of business activities of multinational companies were tackled. Additionally, this question was dealt with in more details in the case study conducted on the two companies belonging to the Hypo Group Alpe Adria in Serbia: Hypo Alpe Adria Bank Beograd a.d. and Hypo Alpe Adria Leasing d.o.o Beograd. The conducted research points out to another specific type of multinational enterprise and its activities in the Serbian market. Namely, the two analyzed companies belong to the financial sector and in this way represent another type of multinational operations in Serbia. As it was explained earlier, Hypo Alpe Adria Bank in Serbia was formed by the acquiring of the Serbian Depozitno - kreditna bank, which also points out to another type of operations handled by multinational companies - acquisition. Furthermore, the Hypo Alpe Adria Bank Beograd a.d. is a joint - stock company, while Hypo Alpe Adria Leasing d.o.o Beograd is a company with limited responsibility.

Question 2 refers to the contribution of multinational companies to the employment increase of the local staff in Serbia. This case study showed the following: during the first year of the business activities of the Hypo Alpe Adria Bank Beograd a.d., the number of employees in the Bank was 27 people. Once the Bank started with its aggressive expansion via establishing branch offices throughout Serbia, the number of employees rapidly started to increase from one year to another: in 2004 the number of employees was 323, in 2005 the number of employees reached 531, in 2006 there were 700 employees, in 2007 a total of 803 employees, and finally in the end of 2008, the Bank had a total of 871 employees (described on pp 13, 14).

Following the same principle of the extensive branch office expansion as the Bank, the Hypo Alpe Adria Leasing d.o.o Beograd also achieved employee growth trend over the years: in the very beginning in 2002 there were 9 employees working for the company, in the following year this number doubled to 20 employees, in 2004 the growth trend continued and reached 41 employee, in the end of 2005 there were 67 employees, in 2006 this number grew to 82 employees, in 2007 the growth continued and the number of employees reached 107, and finally in the end of 2008 there was a total of 136 employed people in Hypo Alpe Adria Leasing d.oo. (described on p. 37).

These data show that the two companies analyzed contributed to the employment increase of the local staff in Serbia, having in mind that the Bank established 871 new working places and the Leasing company established 136 new working places, leading to the conclusion that Hypo Group Alpe Adria in Serbia employs approximately 1000 people.

Questions 3 and 4 referring to the improvement of managerial and entrepreneurial techniques, strategy of managers and the modes through which this has been achieved, are clearly elaborated in the sub-sections of this chapter which tackle several aspects: marketing and relationship towards clients, human resource and relationship towards employees, corporate sector and infrastructure, technology and transportation development.

In order to determine the above stated issues, interviews with the responsible personnel of the company, members of the top and middle management, as well as the revision of original documentation and archival records, showed that departments with most innovations and new business methods are marketing department, human resource department, corporate sector, and the logistics sector with its technology innovations.

As it has been previously mentioned, the main task of the marketing department was to create and promote the corporate image, which points out to the fact that Hypo Alpe Adria Bank a.d. Beograd takes care of its clients in the same way as it takes care of its employees, and that it is a reliable partner who nurtures the local community in which it conducts its business activities. During the conducted research it was determined that marketing department introduced innovations in several segments: communication with the clients, local community involvement and financing, sports and cultural events and healthcare contribution.

Innovations, which the department introduced, firstly revolved around enhancing communication with its clients. For that purpose the following innovations were implemented:

• Clients suggestions program which represents the program in which the clients gained the possibility of sending their suggestions, comments, as well as complaints to the Bank's products and services via the company website or special telephone line, which was introduced for that purpose. Furthermore, feed back from the Bank is also provided to the clients. The program was implemented in Belgrade, as well as other Serbian cities where the Bank had its operations.
• Client satisfaction survey was introduced as innovation to the marketing department in order to determine the levels of satisfaction of clients with the bank's products. This tool is implemented to upgrade products and services, as well as other areas, which are perceived as the ones that need to be improved.
• All under one project is a marketing project launched in 2008 for the purpose of offering existing clients as well as potential ones, much better conditions than normally applied for some of the bank's products like savings and loans. Additionally, simplified procedure was implemented via specially created website where all interested parties could acquire all necessary information. Direct benefit from this project was the increase of corporate and retail clients.

Particular segment of the marketing activities is dedicated to the activities of the Bank directed towards the local community and individuals living in it. Significant activities marked during this research are activities directed towards vulnerable social categories, children and young population, in the first place. The Bank participated in the following projects:

1. Renewal of the Institute for neurology and psychiatry of children and young adults.
2. Upon the opening of its new branch in Leskovac, the Bank decided to join the educational program launched by Telekom Srbija[13] in order to raise the level of educational quality in cities other than Belgrade. For that purpose, the Bank donated twenty computers to the local school.
3. The Bank made a donation of fifty computers, printers and necessary accessories for children without parents and parent care, which are living in Children's Village in Sremska Kamenica. Furthermore, the Bank traditionally donates financial means to the Village every year, in the annual amount of 1.5 million dinars.
4. Project "Scholarships for the best" in coordination with the Ministry of Work and Social Policy. The main purpose of the action is to show responsibility towards the most jeopardized members of the community - high school students and college students, who live in difficult living conditions
5. Scholarships for one hundred disabled children in the monthly amount of 150 euros.

In the field of marketing, the actions of the Bank were coordinated with the actions of the Leasing company. Hypo Alpe Adria Leasing d.oo. supported the following projects:

• Realization of the program "School without Violence", launched by UNICEF in Serbia.
• Renovation of facilities in the institution Jovan Jovanovic Zmaj, where children without parental care grow up.

Additionally, in the field of healthcare the Bank initiated the following projects:

• AIDS control program in cooperation with the Graduate School of Economics.
• Yearly program for its employees for volunteer blood donations in cooperation with Blood Transfusion Institute of Serbia and establishment of its own Association of voluntary blood donors, which has over one hundred members.

Another form of local community contribution is the sponsoring of cultural and sports events. Most significant events supported by the Bank are:

• Belgrade Fashion Week
• Good Year Basketball League
• International Cycling race "Through Serbia"
• Tennis Association of Serbia and many others.

Moreover, as far as sport is concerned, coordination of Bank's activities with the activities of the Serbian authorities was done in order to raise awareness of sport significance in Serbia, as one of the strategic goals of the Serbian authorities.(described on pp ...). This step resulted in two side benefit: on one side, the bank's image was linked to the success of the famous tennis player and everything he represents, and on the other side, rich and interesting media campaigns for credit cards, loans and other services of the bank with the face of Novak Djokovic in them, influenced the awareness of people living in Serbia about values of sport success.

In this segment Hypo Alpe Adria Leasing d.o.o. Beograd realized sponsorship support to the basketball club "Partizan". By doing so, the company has joined the sponsor pool, which consists of the most reputable companies from Serbia and abroad.

Local community contribution is also perceived through local government financing, where the Bank has been particularly active, having in mind the fact that for the past twenty years there had been no investments in the public sector of Serbia. For that purpose, Sector for public enterprises and local government financing was introduced as an innovation to the Bank's activities. It firstly established contacts with 100 local municipalities throughout Serbia and by the end of 2008, approximately 40 million euros of financial means have been placed by the Sector for public enterprises and local government financing. For that purpose innovation model of project financing, was introduced and represents a completely new form of financing in the Serbian market. Through this model the Bank financed two strategically important projects for Serbia:

1. The construction of facilities for one of the biggest student sports competitions in the world - Univerzijada 2009.
2. Development of the gas pipeline in Serbia in cooperation with JP Srbijagas.

Human resource (HR) department was established in 2003 and also represents the department, which the Bank and the Leasing Company share in the sense of coordinated activities. The HR department has been very active in the sense of innovations, trying to keep track with the fast employee growth. The department had several key priorities:

• To enable quick integration of new employees into the system.
• To create corporate identity and team atmosphere within the Group.

The department was planned to become the source of educational staff, which would be capable of taking on new jobs, initiatives and development. Generally speaking, the conclusion could be drawn that the HR department has two principal segments of actions where the majority of innovations have been introduced: staff education and employee satisfaction care.

Firstly, majority of its activities are dedicated to the raising of employees` expertise level through different types of educational trainings (motivation trainings, special skills development courses and language courses), which are organized internally and externally. Some of the most important types of trainings, depending on the sector are:

• Cross - selling courses
• Microsoft Office Excel seminars
• Insurance trainings, which enables the participants to obtain the license of the insurance mediator
• Small and medium sized enterprises trainings
• Seminars for the sale of pension and investment funds
• CDO`s and Credit linked trainings
• Specialist courses MCPD and MCITP Database Administrator for staff in the sector for informational technologies
• System Oriented Management course 1 and 2
• Optional modules
• Top executive Education
• Public Finance Basic Training
• Project management - Train the Trainer
• Project Management for Top Management

In fact, it is evident that, the HR department of the Bank cooperates closely with the relevant public institutions and other external providers such as the National bank of Serbia, Association of Banks in Serbia, Serbian Chamber of Commerce, and Institute for Business Research, in order to provide its employees trainings related to international accounting standards.

Special attention is dedicated to the level of English language knowledge of employees, having in mind that the Group operates in twelve countries and that everyday communication involves the use of foreign languages. English courses are provided for all employees, at the expense of the Company. Additionally, certain numbers of employees who occupy the positions, which are directly linked to the headquarters of the Group in Austria, take courses of German language, whose expenses are also borne by the Company.

Another innovation introduced by the HR department in the field of staff education, which should be highlighted is internal employee - training center, whose main goal was to turn the existing knowledge of employees in the practical experience of the staff. The center was formed in order to initiate internal transfer of knowledge among employees, information sharing, better communication, which consequently led to better work performance and improvement of inter-personal relations within the Bank. It is modern and completely technically equipped for internal and in - house trainings, seminars and workshops for employees. Just how efficient this project was, show the data that in the first three months upon its establishing, more than 400 employees have participated in organized trainings, and in one year more than 900 employees successfully passed over 30 internal educational and development programs of the center. (described on p.16).

Professional development of the middle and top management members is also a special segment in the field of education for the HR department. For that purpose, development center operating within the HR department was established in order to assess development necessities of the staff belonging to these levels of management. The center analyses results of interviews, surveys and supervisors suggestions, and consequently creates individual development plan for every employee. Additionally, team development plans are introduced as innovations in this field and are created and being implemented on entire teams in specific sectors.

Employee satisfaction care is another segment of the activities of the HR department, which is being realized through the Employee satisfaction program. The program was originally based on yearly interviews of employees and their superiors on the subject of work efficiency and success, through self - evaluation done by the employee, and the evaluation obtained from the superior. In order to upgrade the program, in 2007 HR department decided to introduce innovations such as the employee satisfaction survey. This type of survey is conducted among all employees in the end of every working year, and concentrates on the four most important areas of employee satisfaction: general satisfaction with work and work conditions, communication and interpersonal relations, leadership, bonus systems and career opportunities. Achieved results from the survey serve as the basis for strategy planning for the upcoming years. This innovation is particularly important in order to include the opinion of the staff in the process of future strategy defining and decision - making, so that everyone can benefit from it.

The realized research in the logistics department points out to the infrastructure and technology development, showed in the following results:

• Facilities of the bank, leasing and other companies within the Group have been expanded from 2000 square meters of office space in 2002 to a total of 20.100 square meters in the period of six years and approximately 25 million euros have been invested in the construction and renovation of its office space, as a result of extensive branch office establishing (described on p.25.)
• Development of transportation system is obvious (described on p.25).

Technology development was significant and requested thorough analysis. The research points out that the following innovations in this field positively contributed to efficiency and quality of service given to internal users and external clients:

• Intranet network
• Temenos 24, one of the world's most modern contemporary banking software.
• File net software, which helps enterprises manage their content and business processes
• Information Technology Infrastructure Library.
• Electronic banking
• Triple S project
• Complete automatization of work creating procedures
• Development of application protocols
• Catalogues of products and services
• Application for success assessment
• Internal revision system
• Data bases of treasury sector

Upon the conducted research on the corporate sector, it could be concluded that it has several innovative products (described on p. 10 - 12.) offered to the clients, which are new in the financial market of Serbia:

• Cross - border financing
• Revolving line financing
• Cross - selling activities

At this point, it should be particularly highlighted that Hypo Leasing doo. Beograd was the first leasing company to penetrate the market of Serbia and introduce the following innovations in the finance sector: real estate leasing, vehicle leasing and equipment leasing (described on p.33 - 36). The company is actually a pioneer in this segment of finance in Serbia.

As far as the environmental protection is concerned, the Hypo Group globally has been dealing with the topic of renewable energies for years, and gives its contribution to environment protection by financing heat production projects and energy production projects. In the case of Serbia, Hypo Alpe - Adria - Leasing d.o.o. Beograd in cooperation with the Hypo Bank finances a project of particular importance launched by JP Srbijagas. The project refers to the development of the gas pipeline in Serbia and envisages building high-pressure gas pipeline and development of gas distribution networks.

Question 5 referring to the variables which influence the success of Hypo Group in Serbia lead to the following conclusion: there are very positive factors that influence the success of this company, but there are also some obstacles which are making certain types of activities difficult to conduct.

According to the interviews with the representatives of top and middle management, identified positive factors are:

• Good geo-strategic position - key regional position of Serbia and privileged access to the markets of East and West, which is particularly important for the Hypo Group, having in mind that the company is locally oriented, with the main focus on the Alps - Adriatic region.
• Size of the Serbian market as the largest market of all former Yugoslavian republics and the second largest country in Southeastern Europe, which makes it significant for the Group to position itself in Serbia and develop its business activities, once again, having in mind it is locally oriented.
• Development potential of Serbia, which is noticeable after 2000 and the beginning of economic reforms, which are still in progress. Referring to the topic of economic reforms, reforms in the banking sector and bank restructuring were one of the main priorities in the reform agenda of the new Serbian authorities, after 2000. As it has been previously mentioned, the essence of the reforms was to undertake bank rehabilitation and re-capitalization of the banks, which could be viable institutions, in order to make good prospects for privatization through sale to strategic investor from abroad. Consequently, four large and deeply insolvent banks, which accounted for 60% of the book value of the sector's asset and for about two thirds of outstanding commercial credit to non - financial sector, were liquidated. Furthermore, banking legislation and regulations were improved. After the first major wave of reform, credit institutions have become more cautious in lending money to the real sector which was still very week. The government immediately acted on attracting foreign investors since there was an urgent need for such a thing. Consequently, from the late 2000 to December 2002, National Bank of Yugoslavia (the central bank) issued eight bank licenses, out of which seven were for the foreign owned banks, and by doing so, it finally opened up the opportunity for the relevant foreign investors to come in to the banking sector.
• Qualified workforce with a capacity to quickly adapt to changes within a company. Namely, out of all employees working in the Bank, 47% have acquired university education, while 33% percent have secondary education, which points out to the level of qualification of employees. Additionally, majority of the employees (53%) belong to the age group 30 - 39 years old, which consequently leads to the fact that they are capable of adapting more easily to the changes within the company. It should also be taken into account, the practice of the Group is to send employees for temporary trainings in other companies within the Group in order to get greater knowledge and experience.
• Investment climate that keeps on improving. In that sense, Serbia is considered to be friendly and a better environment for foreign investors, in comparison to the period before 2000. Set of legislation act, which regulate different forms of foreign trade activities, which were prepared in accordance with the EU legislation acts, have been declared by the Government after 2002. The key legislation of the foreign direct investment regime is the Foreign Investments Act[14], which was positively assessed in comparison to similar laws in other countries. It regulates the investment procedure into enterprises while investments into insurance companies, banks, other financial organizations, lottery games, and free zones are done in accordance with the laws that refer to each of these fields. Furthermore, the Act on Banks[15] and the Financial Leasing Act[16] are relevant for enterprises with foreign direct investment in Serbia, in the field of banking and financial leasing, such as the Hypo Alpe Adria Bank a.d. Beograd and Hypo Alpe Adria Leasing Beograd d.o.o.

The following potential obstacles have been identified:

1. Transition process in which Serbia is currently involved. Interviewed managers see a potential problem in the following: loans extended to retail and corporate sectors are indexed in foreign currency, and any change in the course of reserve currency, causes the growth of credit risk and reduces the ability of borrowers to return loans.
2. The still existing relative isolation of Serbia from the regular flows of world trade.
3. The consequences of the World Financial crises, which are becoming more severe and are affecting all participants in the financial sector. There is a decreased demand for loans from the corporate and retail sector.

To resume, in the present research on Hypo Group Alpe Adria, the investigation was conducted by using open - ended interviews, revision of original documentation, archival records and direct observation of the author, which is accordance with the proposed methodology of the case study suggested by Yin (1994). Additionally, the author interviewed the representatives of the Serbian Government, Serbian Chamber of Commerce and local community representatives in order to support the claims of interviewed managers from the Company.

Therefore, the analysis of activities of the company, points out the following, positive effects which could be fragmented on the company level itself, as well as the local and the country level of Serbia:

1. Contribution of Hypo Group to the field of banking industry and financial leasing in Serbia and its internationalization is significant. Hypo Alpe-Adria-Bank a.d. is Serbia's fourth-largest bank with a market share of 6.47 %, referring to total assets, and Hypo Alpe-Adria-Leasing Beograd d.o.o. is the absolute leader in the market, with a cumulative market share of 36.3%. Contributions are particularly seen through new financing instruments available to citizenship and companies in Serbia, which these two companies introduced from the beginning of their operations in the country.
2. Contribution of Hypo Group is obvious referring to the employment increase of the local staff in Serbia. Namely, the Group has established approximately 1000 new working places over the eight years of its activities in Serbia.
3. Establishment of good and partner relations on the local, as well as republic level of authorities. The company takes active participation in significant infrastructure and the local community investment projects.
4. Social responsibility and employee care should also be highlighted, having in mind the company's plan of employee development and significant amounts of financial means invested in education and employees training programs As far as social responsibility is concerned, the two analyzed companies within the Group actively participate in various projects which are of significance to the local community and individuals of Serbia.
5. Cultural preservation is nurtured in the Hypo Group in Serbia as it respects the cultural traditions of its employees, while maintaining high standards regarding procedures and high quality of work. This sets an extremely positive example of high work efficiency and the nurturing of cultural traditions of the work force.

Taking into consideration all of the above stated, it is possible to conclude that the case study conducted on the Hypo Group Alpe Adria in Serbia, showed that the company had positive influence on Serbia's socio-economic development and economic growth. Also, its contribution to the local community, social responsibility and employee care, cultural preservation, innovations in the field of financing instruments, infrastructure and technology, which have been described earlier are noticeable.

Concerning the limitations, some of them were pointed in this case study. Namely, they are:

• The conclusions reached in this study can only be useful to the specific industry to which the company belongs. Each industry has its own specificities, depending on the area, and the same goes for multinational companies. Therefore, conclusions, which were reached during the research on Hypo Group in Serbia, are relevant for the sector of banking and financial leasing in Serbia. Additionally, these conclusions cannot be generalized and may be invalid for the activities of Hypo Group in countries other than Serbia, since these countries represent different working environments.
• Once again, the problem of interviewing multinational managers is obvious. The author sent letters to approximately twenty-five companies, out of which only three companies accepted the interviews on proposed subjects. Therefore, the conclusions reached in this case study cannot be treated as general conclusions on multinational companies` operations, but only as company specific conclusions. As it was shown during the research, Hypo Group established its own legal entities in Serbia, which is focused on the financial market. Other multinational companies which have not been included in this research and which operate in different fields of activities may lead to different conclusions. For example, multinational companies, which are involved in manufacture, may have obvious contribution the environment (either positive or negative) issues, which is not the case with Hypo group in Serbia who participates in the environmental policy issues indirectly.
• The number of managers interviewed by the author was limited. During the research on the Hypo Group, the author managed to schedule appointments with ten managers (one representative of the top management and five representatives of the middle management and four executives). The official position of the company was to limit the number of interviews, in order not disturb the daily business activities of the company. Furthermore, some information requested by the author regarding exact numbers referring to company's business activities were considered confidential by the interviewed managers and the author could only review them in the facilities of the company.

1. The Alps-Adriatic Working Community was founded in Venice on the 20th of November 1978. The founder members were: Bavaria, Friuli-Venezia Giulia,Carinthia, Croatia, Upper Austria, Salzburg (active observer), Slovenia, Styria, Veneto. By signing the "Joint Declaration" the informal amicable relationships between the border regions were transformed into an organization with clearly defined tasks and aims. (Available at https://www.alpeadria.org)
2. For further information, please consult https://www.hypo-alpe-adria.com
3. Source: National Bank of Serbia (available at the official website www.nbs.rs)
4. Association composed of the most successful entrepreneurs in Serbia.
5. Telekom Srbija A.D. is a leading national telecommunications company in Serbia.
6. NIS - Petroleum Industry of Serbia is an oil company from Serbia, which will hold monopoly on oil imports till 2011.
7. Univerzijada 2009 is the twenty fifth-anniversary summer Universiade and it was held in Belgrade in July 2009. It is the biggest sport event held in a country besides Olympic games.
8. JP "Srbijagas" is publicly owned enterprise for transportation, distribution, storage and trade of natural gas. It is the leader in the gas market of Serbia.
9. The slava, also called krsna slava (?) and krsno ime (?, literally 'christened name' in Serbian), is the Orthodox Christian tradition of the ritual celebration, veneration and observance of a family's own patron saint. The family celebrates the slava annually on the patron saint's feast day. The slava is primarily associated with the Serbs; they regard it as one of their most significant holidays.
10. Belgrade suburb
11. Source: Ministry of Economy and Regional Development of the republic of Serbia, available at the official website https://www.merr.sr.gov.yu/aktivnosti/vesti.php?vestid=403
12. The Kyoto Protocol is a protocol to the United Nations Framework Convention on Climate Change (UNFCCC or FCCC), aimed at combating global warming. Source at the web site of the United Nations www.un.org
13. Telekom Srbija A.D. is the leading telecommunications company in Serbia.
14. "Zakon o stranim ulaganjima'' Službeni list SRJ (Belgrade: Official Journal 2002. and 2003) No.3 and No.5,
15. Zakon o bankama ("Official Journal SRJ", no. 32/93, 61/95, 44/99 i 36/02 i " Official Journal RS", no. 72/03 i 61/05).
16. " Zakon o finansijskom lizingu'' , Službeni glasnik Srbije (Belgrade: Official Journal 2003) No.55.

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