ZAGREB, March 28 (Hina) - The Croatian National Bank's (HNB) Governor Marko Skreb on Tuesday said intensive efforts were being taken to find solutions for the injection of fresh capital in the Istarska Bank, for which a temporary
trustee has been appointed recently. Skreb described the latest developments as "exclusively the political pressure on the HNB regarding decision on one bank," and as "political pressure from one region". The central bank and he personally, Skreb said, do not shun responsibility and would like to see a well-argumented and precise parliamentary debate on this matter. "I support an expert, open and well-argumented discussion on the central bank's role in the banking system, and let the Sabor draw its conclusions from that," Skreb said responding to a question about Premier Ivica Racan's announcement that a parliamentary majority will soon call Governor t
ZAGREB, March 28 (Hina) - The Croatian National Bank's (HNB)
Governor Marko Skreb on Tuesday said intensive efforts were being
taken to find solutions for the injection of fresh capital in the
Istarska Bank, for which a temporary trustee has been appointed
recently.
Skreb described the latest developments as "exclusively the
political pressure on the HNB regarding decision on one bank," and
as "political pressure from one region".
The central bank and he personally, Skreb said, do not shun
responsibility and would like to see a well-argumented and precise
parliamentary debate on this matter.
"I support an expert, open and well-argumented discussion on the
central bank's role in the banking system, and let the Sabor draw
its conclusions from that," Skreb said responding to a question
about Premier Ivica Racan's announcement that a parliamentary
majority will soon call Governor to account.
The Sabor appoints the HNB Governor to the office of six years, and
it is up to the parliament to relieve them of the duty. Skreb took
the office on March 1, 1996.
For Skreb, it is interesting that Croatian European Integration
Minister Ivan Jakovcic insists on his replacement. "It would be
interesting to hear whether some ministers of the European Union's
member-countries ask for the dismissal of the governor," Skreb
wondered.
Ivan Jakovcic is also the President of the Istrian Democratic
Alliance (IDS), the ruling political party in Istria County.
Jakovcic maintains that the Istarska bank should not have been
blocked, and warns of the consequences of such a move of the
temporary trustee for the economy in that county. He is also
dissatisfied with the appointment of the temporary trustee.
The central bank's officials spoke in detail about many
irregularities noticed in the Istarska bank's operations, and last
Wednesday the temporary trustee was sent there.
The decision on the Istarska bank's temporary trustee was made, in
compliance with the banks act, after it was assessed that potential
losses might be bigger that the liable capital. The decision was
taken independently, and on Tuesday Skreb revealed that Jakovcic
himself had phoned the Governor proposing that the trustee should
be elected from members of the bank management. Jakovcic's proposal
could not been accepted, as it is the practice that a trustee should
not be from the bank where he is appointed as the temporary trustee,
Skreb explained.
The trustee has been appointed to do his job within three months. He
should settle the bank's problems and find a strategic investor
that will be ready to recapitalise the bank, the Governor added. The
temporary trustee has called on Croatian banks to say whether they
are interested in. Skreb on Tuesday called on share-holders and a
possible strategic investor to deliver their offers by Friday.
Skreb said total costs of two crises in the country's banking system
amounted to about $5.5 billion. He recalled that the first one had
been caused by problems inherited from the former (Communist)
system, and the second crisis happened in 1998, partly owing to the
Dubrovacka bank scandal.
(hina) jn ms