Carried by 59 votes to 11, the bill will protect the bank from claims in Croatia stemming from Yugoslav-era deposits of Croatian citizens with the defunct Ljubljanska Banka (LB), which have been proliferating in recent months.

It determines that the financial consequences stemming from such claims would be borne by the Slovenian Succession Fund, but the fund will cover only claims that would be enforced, not claims that the bank may settle voluntarily.

The government says the settlement of the claims through the Succession Fund is in line with Slovenia's long-standing policy that the LB claims are a succession issue and should be settled in the framework of succession talks.

The government says this solution does not make NLB, the fund or Slovenia liable for the claims in Croatia, the fund would merely compensate the bank for negative financial consequences.

Aside from protecting the bank, it will also allow the state as the sole shareholder to pay out dividends of nearly EUR 190m pending clearance from the European Central Bank (ECB).

The ECB has reportedly withheld approval to shore up the bank's capital base out of fear that NLB could be on the line for several hundred million in contingent liabilities in Croatia.

Finance Minister Mateja Vraničar Erman urged MPs today to "protect Slovenia's ownership interest in NLB."

She said their votes were not votes in favour of privatization - that had been confirmed before - they were in favour of the fulfilment of commitments to the EU Commission.

All parties bar the Left and the National Party (SNS) voted in favour; the former opposes privatization as a matter of principle and the latter said everybody would ignore this law anyway, in particular Croatia.