Addressing the conference on the impact of CHF loans on citizens' living standards, Lovrinovic said that since the sudden surge in the value of the Swiss currency, 13 billion kuna had gone unfairly to banks.
That money is not circulating and is sitting in banks' accounts, while the middle class has eroded, with their purchasing power additionally weakened, which has led to problems with production because the number of people who can buy anything has been dwindling, said Lovrinovic.
"That is one of the reasons the current recession is so long. Billions have gone to banks and they have become super-solvent... That money is sitting in their accounts or is used to finance the state, while we have been drowning in the recession and the question is when we will be able to overcome it," said Lovrinovic.
He noted, however, that the status of banks had been increasingly difficult as well.
The rate of irrecoverable CHF loans is nearing 40%, which means that the currency risk has started to turn into a loan risk, Lovrinovic said, adding that the foreign currency clause in loan contracts should be removed.
"The whole country is exposed to a horrible foreign currency risk and the only one to be blamed for it is the Croatian National Bank," said Lovrinovic.
He went on to say that the central bank had approved a risky product, CHF-pegged loans, even though it was aware of possible consequences.
"The central bank did not generate domestic money, the kuna, so that it could lend it to banks and they, in turn, could lend it to households. Due to lack of money... they turned to their parent banks and took foreign currency loans. That fits into the country's general import strategy, considering that we import everything - pork, onions, carrots and foreign currencies alike," he said, adding that the situation would not change for the better until the existing monetary system was reformed.