The Slovenia Times

Coalition opposed to pre-IPO option, fine for NLB


The three coalition partners disagree with the idea to sell a minority interest in NLB to a known buyer by the end of the year in a pre-IPO placement as well as the idea that NLB should pay compensation to the state instead of being forced to sell its Balkan subsidiaries.

The sale of the Balkan subsidiaries is envisaged as a sanction for failed privatisation in the document with which the European Commission approved a EUR 1.55bn state injection into the bank in late 2013.

Slovenia initially committed to sell 75% of NLB minus one share by the end of 2017, but then renegotiated to sell 50% by the end of the year and the remaining 25% by the end of 2018. However, the government halted the privatisation procedure in June.

The sale of NLB under the conditions and circumstances existing at the moment is absolutely unacceptable for the Modern Centre Party (SMC), the party's deputy faction leader Simona Kustec Lipicer said after the coalition meeting.

She said the party was aware of the commitments made to Brussels in 2013, but said that the circumstances were different now and that the risks related to the Croatian lawsuits over Yugoslav-era savings deposits in particular had not been taken into account at the time.

It is necessary to find a third solution that both the European Commission and Slovenia would be satisfied with, Kustec Lipicer said, adding that the government and the SMC would not agree to a solution that would put an additional burden on the taxpayer.

Asked whether it might be good to sell the bank to prevent political interference in its affairs and save the taxpayer from a potential new bailout, the SMC official referred to new corporate governance standards applied at the bank which meant "politics is not interfering in NLB's operations directly".

Karl Erjavec said his Pensioners' Party (DeSUS) was against selling what is a systemic bank that had already been recapitalised by the taxpayer. The latter would lose twice, having bailed out the bank and again if the bank was sold at an inadequate price. He too mentioned the Croatian savings issue.

NLB has recovered and is performing well, Erjavec said, arguing that the European Commission did not treat all member states the same way in such cases. He expects that Slovenia will manage to persuade the Commission it will not have to sell NLB.

Matjaž Han from the Social Democrats (SD) also cited changed circumstances asserting that it would be "foolish to sell the bank, which is doing well, now". He said a deal should be reached with the European Commission whether the bank should remain state owned or whether to defer the sale until it could be sold at a right price.

The government will discuss the issue of Thursday when it is officially notified on the content of Finance Minister Mateja Vraničar Erman's recent meeting with Competition Commissioner Margrethe Vestager.

The Finance Ministry said in a press release that the next meeting between Vraničar Erman and Vestager was expected to be held on Friday.

The ministry added that its representatives and European Commission experts were already discussing at the working level possible measures for changing the commitments related to the privatisation of NLB.


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