ZAGREB, March 18 (Hina) - Bayerische Landesbank (BLB) will give its shares in Rijecka Banka to the Croatian state and the state will take on the obligation to recapitalise the bank, Deputy Prime Minister Slavko Linic said after talks
with representatives of the BLB, Rijecka Banka's majority owner, on Monday evening.
ZAGREB, March 18 (Hina) - Bayerische Landesbank (BLB) will give its
shares in Rijecka Banka to the Croatian state and the state will
take on the obligation to recapitalise the bank, Deputy Prime
Minister Slavko Linic said after talks with representatives of the
BLB, Rijecka Banka's majority owner, on Monday evening. #L#
Two biggest shareholders in Rijecka Banka - Bayerische Landesbank,
which holds around 60 percent of shares, and the state, which holds
25 percent, have reached an agreement on covering losses incurred
due to a case of embezzlement in Rijecka Banka. Today's agreement is
a message to all investors and depositors that there are no more
risks, Linic said, announcing that the bank's management would be
replaced.
The Croatian National Bank (HNB) will assess the damage and the
amount of money needed for the recapitalisation. The minimum amount
is two million euros and the maximum amount 40 million, he said.
Today's agreement between government and BLB officials should be
considered by other state and bank bodies. The BLB holds around 70
million euros worth of shares in Rijecka Banka.
The state has no intention of remaining the bank's majority owner.
Once all information is known, the state will offer its shares for
sale, Linic said, announcing that talks with potential new owners
would start tomorrow.
An internal inspection in the bank, carried out on March 6, showed
some irregularities in the bank's Directorate for Foreign
Currency. On March 8 the bank pressed charges against its main
stockjobber Eduard Nodilo, who is suspected of violating the bank's
internal regulations, the unauthorised transfer of foreign
currency, and unconscientious work.
The value of damage caused to the bank has not been established yet.
HNB governor Zeljko Rohatinski said in New York today that
according to information from the bank the damage amounted between
83 and 103 million dollars.
The bank's clients withdrew 26 million euros from Rijecka Banka
last Friday and Saturday. Despite claims by the bank's management
that the bank is highly solvent and that all depositors will be able
to withdraw their money, the bank's clients were waiting in queues
to withdraw their money on Monday as well.
(hina) sb rml