CENTRAL BANK GOVERNOR ON WHY UNICREDITO REQUEST WAS REFUSED

ZAGREB, June 7 (Hina) - The intended acquisition of shares of Croatia's largest bank (ZABA) by the UniCredito/Allianz consortium could have adverse effects on monetary and foreign currency policy measures, hampering the realisation of the Croatian National Bank's (HNB) main goal, to achieve and maintain stable prices. The HNB Council has been proposed to turn down a UniCredito Italiano S.p.A. request to purchase up to 70, and another by Allianz AG to buy up to 20 percent of Zagrebacka Banka (ZABA) shares. This is the official explanation issued by HNB's permit issuance commission, which on Wednesday debated the Italian-German consortium's request to take over ZABA. The HNB received the request on May 29. The HNB Council did not debate the request as a note saying it had been withdrawn came the day before. HNB governor Zeljko Rohatinski said on Thursday the central bank's negative stance towards UniCredito's request to be issued previous consent to take over Zagrebacka was primarily based on an overview of long-term relations on the Croatian financial market. Viewed in terms of market concentration and competition, the current state of these relations have lead the central bank to assess that it might be harmful to link ZABA, directly or indirectly, or harmonise its transactions with another of the biggest banks based in Croatia, according to Rohatinski. The most important thing is that ZABA remains a strong, stable and promising financial institution, the biggest and one of the most successful in Croatia, which will be able to realise its development plans through a business arrangement acceptable to all interested parties, the HNB governor concluded. (hina) ha sb