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“Negotiations are already under way, and as the reduction concerns more than 30 employees, we had to announce a group-level staff reduction,” says Zoltán Papp.

“Between 2000 and 2008, Lombard’s income and number of employees dynamically increased, we had become market leaders in vehicle financing. In the last 3 years however, due to dramatic changes in the exchange rates of the CHF, the collapse of the lease market and unfavourable legal changes, Lombard booked significant losses. For years the company has been striving to survive by trying to preserve as many workplaces as possible,” added Mr Papp.

The Hungarian lease market registered 75% decrease between 2008 and the end of 2011: 2008: 5.7 million EUR; 2009: 2.4 million EUR; 2010: 1.6 million EUR; 2011: 1.6 million EUR. This, of course, had a serious effect on the results of Lombard.

By now, the company has had to revise its strategy, and it has decided to concentrate on sustainable operation. The reduction could affect 20% of the employees, said the HR Director. According to their new strategy, Lombard will concentrate on the branch in which they are the strongest: from a universal leasing company they will become a public vehicle financing firm. Their most important business branches will include public new-car and used-car financing, as the company is still a market leader in these branches.

The HR Director emphasised that this reduction is not directly in connection with the change in leadership: “The strategy accepted just now had already been drafted by the leaders and owners of Lombard in spring 2011; the new strategy was accepted by the management this month. The mandate of András Domonkos, former CEO of Lombard Leasing Group, lapsed in the end of 2011”.