The HNB has never and will never prevent the arrival of foreign banks, including Slovene banks, on Croatia's banking market. The position of the central bank on the possible access of the KBC or the Nova Ljubljanska Banka d.d. to Croatia's market cannot be linked with commitments stemming from the Stabilisation and Association Agreement (SAA) on free movement of capital or the right to establishment, the central bank said in the lengthy press release.
To corroborate its statement, the HNB cited data saying that foreign entities currently hold 92 percent of Croatia's banking system.
The HNB also reiterated criteria and procedure which must be observed when decisions are made on the assumption of a qualification share in a bank, stressing that the procedure is transparent and offers legal protection.
Should it come to a procedure to decide on the KBC's request, the HNB will bear in mind that in 2002 the KBC Bank, as part of the KBC Group, took over a 34 percent share in the Nova Ljubljanska Banka, that KBC Bank appointed four out of 11 members of the Slovene bank's supervisory board, that the Slovene government holds a 35.41-percent stock in the Nova Ljubljanska Banka, and that the Ljubljanska Banka d.d. has still not returned the savings deposits to its Croatian clients.
The HNB also points to the fact that the Nova Ljubljanska Banka has been trying to prove that it is not a legal successor to the Ljubljanska Banka, although it has taken over the latter's real estate and assets but not its obligations.
The HNB also recalls that non-Slovenes are prevented from initiating legal proceedings in Slovenia to claim back their savings deposits from the Ljubljanska Banka.
When it decided to take over shares in the Nova Ljubljanska Banka, the KBC knew or should have known how the bank was established and that owed money to its clients in Croatia.
The KBC should be aware that the moment it entered the Nova Ljubljanska Banka, it was exposed to reputation risk in Croatia, the HNB said.
According to the press release, the Nova Ljubljanska Banka has so far failed to take any steps to pay off the debt to clients in Croatia. Neither has the KBC made any steps for three years, which is how long it has been engaged in the management structures of the Slovene bank.
Furthermore, the KBC has used and is still using through operations of the Nova Ljubljanska Banka the funds of the Ljubljanska Banka, which include the funds of Croatian clients, the HNB said.
According to the volume of its assets and net profits, the HVB Splitska Banka is the fifth-largest bank on Croatia's banking market. This fact should not be neglected when considering reputation risks for its operations, the HNB said.
It is well known that the Croatian public disapproves of the fact that the Ljubljanska Banka and the Nova Ljubljanska Banka have failed to pay the debt to clients in Croatia and therefore has a negative attitude towards the Slovene financial institutions, the HNB said.