CENTRAL BANK GOVERNOR SPEAKS ABOUT MACROECONOMIC SITUATION

ZAGREB, July 4 (Hina) - The priority task for the Croatian National Bank (HNB) is to establish an atmosphere in which the banking system will create solvency, HNB governor Zeljko Rohatinski said at a working session of the Croatian Employers Association's (HUP) Council, the HUP reported Friday. #L# The HNB had to stabilise the currency rate and has succeeded, the governor said adding only two years ago the monetary system marked poor liquidity with an average interest rate of 12 percent. Speaking about negative effects, Rohatinski pointed to the growth in balance of payments deficit from 3.5 to seven (7) percent, an increase in foreign debts (which now amounts to 70 percent of Gross Domestic Product) and the indebtedness of banks in foreign currencies and banks' investments in kuna which increased their net foreign currency obligations. HNB measures resulted in slowing down the growth of bank loans to companies as well as the growth of money supply, said Rohatinski announcing new measures should the current prove to be insufficient. (HINA) IT