Expatica news

Slovenian NLB to increase capital by 381 mn euros

The shareholders of Slovenia’s largest bank Nova Ljubljanska banka agreed Wednesday on a 381-million-euros capital hike to meet the European Banking Authority’s requirements.

Slovenia’s government, that owns a 55.6 percent stake in NLB, will buy 320 million euros worth of contingent convertible bonds that will be issued over the following days.

At the same time, Belgian banking and insurance group KBC, the second largest shareholder with a 25-percent stake, will buy 61 million euros in shares issued by NLB, the bank’s chief executive Bozo Jasovic said after a shareholders’ meeting.

“This capital hike will allow NLB to meet the (EU banking) regulators’ requirements,” Jasovic said adding by the end of the year the bank would need more fresh capital but did not specify the amount.

The London-based EBA said in December NLB needed 320 million euros in capital by the end of June in order to lift its capital ratio requirement to nine percent from six percent.

Slovenian centre-right prime minister Janez Jansa did not rule out on Wednesday the possibility that Slovenia could request eurozone financial assistance for its banks.

“We will be able to answer to that question (whether Slovenia will need EU’s aid) once the ongoing due diligence in Slovenian banks is over,” Jansa told reporters after meeting in Brussels with EU’s head Jose Manuel Barroso, Slovenian media reported.

NLB, burdened by non-performing loans, reported net losses in 2011 of 239 million euros after suffering a loss of 202 million euros a year earlier.