1. Ivana Prgomet PR Advisor October 21st, 2009 THE ROLE OF PR DURING FINANCIAL CRISIS IN THE CROATIAN BANKING SECTOR - CRISIS COMMUNICATION AND EDUCATION

2. 2 Background: Measures – Central Bank End 2008 – relaxed some constraints to increase liquidity – targeted to public sector Early 2009 – increased regulatory burden Controlled exchange rate and liquidity Declared that exchange rate stability is priority, opening pressures on interest rates

3. 3 Background: Measures – Government Calls on government since October 2008 to make decisive moves Announced 10 “Anti-Recession Measures” Rebalanced the budget – three times in 2009 Country rating slightly decreased Issued 750 mil € bonds in May

4. 4 Background: Croatian Banks Unlike some other countries – banks helped government – 2,8 bln € No squeezing out of private sector (still) Reasonable credit activity Raising interest rates Risks lie in real sector

5. 5 Communication strategy CBA has taken the role of “spokeperson” of the entire banking industry Extremely active role Extensive media coverage Most questions to banks ended up with us Coordinating response We made list of Q&A's and increased communication retroactively and proactively with the media

6. 6 Communication objectives Open and continuous communication to all stakeholders: Croatian National Bank (regulator), wider political community, the financial community, economic community, clients of banks, trade unions, NGOs, media, church Objectives: informing, explaining, educating, improving the perception of banks, easing the crisis situation

7. 7 Communication strategy-activities Published CBA analyses, CBA outlook, CBA viewpoints CBA organized a regular briefings for the media; answered journalists' questions, the managing director gave interviews, we participated in a series of roundtable discussions with topics related to banking and financial sector

8. 8 Main topics The financial crisis (the role of the banking sector-related issues) The profitability of banks The movement of interest rates Penalty interest Creditor interest rate Security and protection in Banks Personal bankruptcy Building societies CBA analyses Workshop for citizens and finance mana gement

9. 9 Media coverage (1 st January-30 th September 2009) More presence in newspapers, TV and radio, web portals in the first six months 2009 th than entire 2008 Newspapers 486 - “value” close to €841K TV 109 presences - “value” close to €2.716K Radio 97, additional web portals 72 Media classification – 99% “neutral”

10. 10 Corporate Social Responsibility Workshops for citizens: "How to Balance Income and Expenditure" held in 9 Croatian cities for over 3 years The project developed by UNDP in 2005 through committed work of banking experts, the CBA and UNDP, who prepared and implemented it as it is today

11. 11 Corporate Social Responsibility A paradigm of sectoral activity: not only in Croatia but in other countries as well The banks again recognized the importance of joint action, seeing as this was the first time that an entire business sector had come together and offered its clients a "solution" outside of its selection of products on sale

12. 12 Aim of the workshops To teach citizens how to make financial decisions Set their short-term and long-term objectives Balance their means and wishes with regard to their income and expenditure

13. 13 Workshops The project has attracted over 1,500 participants in 9 cities in over three years The first workshop on personal finance management will be available in e-learning version on the internet this autumn

14. 14 The role of PR... PR in banks and in EIG CBA played a significant role for entire banking sector We managed to keep the situation in the neutral level (illustrated by the media analysis) We believe that we managed to keep trust in the banking sector Negative publicity was a result of macroeconomic and political situation and related events in the country

15. 15 About EIG CBA Founded in 1999 (15 th October) Brings together 18 leading Croatian banks that make 97 percent of the total assets of all Croatian banks Adopted THE CODE OF GOOD BANKING PRACTICE in November 2000 All activities taking place at a series of bodies - committees, subcommittees and commissions and other permanent or temporary work groups

16. 16 About EIG CBA Became Associate member of the European Banking Federation (EBF) in March 2000 and since then participate in all activities of 31 members and 10 affiliated member of the Federation Number of employees: 6...more information on www.hub.hr