GROWING DISTRUST OF CRO BANKS - WARNS CRO WORLD CONGRESS

( Editorial: --> 1771 ) ZAGREB, Aug 4 (Hina) - The Croatian World Congress (HSK) on Tuesday warned about a "serious increase in distrust" of the Croatian banking system and called on the Croatian National Bank (HNB) to as soon as possible stop this "dangerous trend". Prompted by recent events in Glumina bank, the HSK demanded that the disturbed relations in the banking system be restored to order "without any stalling", claiming that people blamed the state for the serious growth in distrust of banks. Glumina Bank has more than US$67.5 million invested by Croatian emigrants at its disposal, the HSK said in a statement signed by HSK president Simun Sito Coric. In late July, the HNB granted a US$31.25 million short-term loan to Glumina bank to help it overcome insolvency. Glumina Bank opted for a voluntary financial restructuring and submitted its own programme to initiate the procedure to the HNB. A decision on the financial restructuring will be reached by the Croatian government. The Glumina bank management however recently stated it believed the solution to the problem lay with the foreign investor and the belief in the bank's potential. Last month, the Lustig Group was announced as the foreign investor interested in a majority share in the bank. According to unofficial sources, the Lustig Group would invest at least US$50 million in the financial restructuring of Glumina Bank. (hina) ha 042004 MET aug 98