"The result is logical given our continued adjustment of the portfolio to realistic values," Janko Medja told Saturday's edition of the paper.

His comments come days before the bank is expected to release operating results for last year. "The main reason for last year's loss is the formation of the required provisions."

Slovenia's biggest bank reported a loss of EUR 305m in 2012, after making a loss of EUR 239m the year before due to a deteriorating loan portfolio.

The bank received a EUR 1.56bn state bailout in December as part of an effort to stabilise Slovenia's ailing bank sector.

It also transferred toxic assets worth around EUR 2.3bn in nominal terms to the Bank Asset Management Company (BAMC), for which it received around EUR 600m in bonds.

That was part of the first transfer of assets to the bank, while four more are expected to follow. The plan for the second transfer has been drawn up, Medja said, adding that a large volume of toxic assets will remain with the bank even after that is conducted.

One of the reasons for this is that the bank cannot transfer assets from its loan portfolio in the Balkans to the bad bank, as the law only allows BAMC to assume assets for companies headquartered in Slovenia.

"NLB and its subsidiaries in the Balkans have many loans which they gave to companies in countries of the former Yugoslavia," Medja said, adding that the bank had conducted a review of these loans last and created the required provisions.

"We are talking about large amounts, which we will disclose after the release of last year's operating results, expectedly after the session of the NLB supervisory board at the end of February," he told Delo.

Medja said the bank was continuing to investigate responsibility for the bad loans. In 2013, it filed more than 30 complaints and the investigations are continuing.

He believes that trust in Slovenia's biggest bank has not been eroded due to its problems with bad loans. "We have never lost the loyalty [of our clients]," he said, explaining that the bank had registered a healthy increase in deposits in January.

"If the bank lost around EUR 400m in retail deposits last year, EUR 300m of that was due to the crisis in Cyprus. When the new management took over at the end of 2012, deposits rose for several months, a sign of trust."

The NLB now controls around a quarter of the banking market in Slovenia.

Asked about financing of businesses, he said that banks were continuing to work to find money for good projects. "But it is clear that we cannot provide loans to overly indebted companies, as new loans would only worsen the position of these companies. I understand it is difficult for some to accept this fact."

"In the past banks gave out loans due to competition and a desire to make deals. This behaviour led to many of the bad loans."

He said companies seeking loans had to be forthright and open about why they needed financing.

Meanwhile, he believes a major obstacle to corporate restructuring is gridlock in making operational decisions for overhauling companies.

"We kept track of companies with healthy cores who could have survived with their healthy parts but not overall. Yet that meant that not everyone could keep their jobs. Due to various interests the healthy parts were not saved and there was no restructuring. Such cases have been the biggest disappointment for me," Medja told Delo.