The bank signed the agreement with the Italian Union, an association representing ethnic Italians in Croatia, on 11 November stipulating more favourable terms and conditions for loans to Union members.
The deal, however, provoked strong reaction from the Croatian public as it was seen as giving preference to members of one ethnic community over others.
On Monday morning PBZ, owned by an Italian bank, issued a press release, saying that it had concluded similar business arrangements containing more favourable terms and conditions with a number of large Croatian and foreign companies, which were either privately owned or state owned, including media companies, public companies, universities, hospitals, different not-for-profit organisations and societies. The bank dismissed reports that its agreement with the Italian Union and the Italian community set a precedent, claiming that such deals were standard practice with major clients with whom overall business relations have been developed.
"All other implications, motivated by petty politics, are absolutely unfounded and blown out of every proportion," PBZ said adding that the procedure for the establishment of creditworthiness is identical for all citizens of Croatia.
Later in the day, the bank issued a second press release saying it had rescinded the agreement with the Italian Union over strong public criticism in Croatia.
"In a bid to remain outside political disputes, particularly those ethnically-motivated, PBZ cancels this agreement which some circles have interpreted in an absolutely wrong manner and have used for political ends, which totally clashes with the merits and the concept of the agreement," PBZ said in its second release on Monday