GOVT TO ENSURE PAYMENT OF SALARIES TO GUCIC GROUP

ZAGREB, Dec 6 (Hina) - The Croatian Government will primarily take care of about 5,000 employees of the Gucic Group who have not been receiving salaries. The Government continues to be prepared to help further restructuring of certain companies in the group, mostly in maintaining the level of employment. The Government will thus ensure a loan for the payment of salaries, the Croatian Economy Ministry said in a statement Monday after a discussion about the Gucic Group at a Government session. "It was estimated that the Zagrebacka Bank was, on several instances, blackmailing the Government by issuing statements about initiating or its intention to initiate bankruptcy proceedings against its debtors, requesting government guarantees for their loan debtors -- which at certain moments burdens tax payers -- so it could improve the Bank's profit in 1999," the statement said. "The Zagrebacka Bank d.d. never consulted the Croatian Government when it approved and prolonged high loans to the group of companies owned by Josip Gucic, with very high interest rates. The Bank is, therefore, recommended to reschedule the debts of certain companies, without state guarantees, and to resolve the problems of its client of several years," the statement concluded. Zagrebacka Bank on Friday said in a statement it had requested the initiation of bankruptcy proceedings for 16 companies under the majority ownership or direct management of Josip Gucic. (hina) lml mm