DEPUTY PM: RIJECKA BANK CRISIS IS OVER

RIJEKA, March 27 (Hina) - The Rijecka Banka crisis is over thanks to the quick agreements, activity and good solutions of the government and the former majority owner Bayerische Landesbank, Deputy Prime Minister Slavko Linic said on Wednesday.#L# The depositors' trepidation has been reduced in a short time, he said, adding the crisis had been caused by the illegal work of the bank's management. Investigation has established the loss will total around US$98 million, with the biggest stockholder, BLB, about to lose US$74 million, said Linic. The biggest damage for the government can be US$25 million for shares it cannot sell, Linic said. He added the state budget would not be tapped for further funds to cover the losses. Small stockholders are not incurring any damage at the moment, apart from declining share values. Linic said the government's solving of bank crises was transparent and always the same. It includes offering owners the possibility to recapitalise the bank or sell their shares. As for Ivan Stokic, the chairman of the board who resigned, withdrew money and sold shares, Linic said it was tragic that Stokic did not believe in his owners. Linic added he trusted the new management, which offered Stokic an adviser's post in the bank. Rijeka mayor Vojko Obersnel, who is on the bank's supervisory board, said he did not intend to resign to his mayor's post. The Rijeka Banka crisis began when Eduard Nobilo, the main stockjobber, was arrested on suspicion of embezzlement. Snjezana Podobnik, the head of the foreign currency sector, was arrested on suspicion of having assisted Nobilo in foul dealings. (hina) ha