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Agroziv Bankruptcy Could Cost NLB Bank up to EUR 60M

Ljubljana/Belgrade, 09 July (STA) - NLB, Slovenia's largest bank, which is hoping for a capital increase of up to EUR 600m, could lose between EUR 55m and EUR 60m as a result of the bankruptcy faced by Serbian food company Agroziv, the STA found out from unofficial sources on Friday.

While NLB has not yet commented on the news, sources close to the state-owned bank and Agroziv explained that Agroziv's key owners, among them NLB, launched receivership proceedings a few days ago.

The owners and creditors of Agroziv are said to have received an offer to settle with payments covering a third of their claims, which NLB, reportedly owed between EUR 55m and EUR 60m, rejected.

The problems of Agroziv, which used to be one of the most successful companies in Serbia, started in 2008. Bankruptcy proceedings were launched in May 2008 along with a restructuring plan. The plan received court endorsement in November, paving the way for an overhaul.

Changes in the ownership structure of Agroziv started last year, leading to Slovenian manager Igor Lavs taking the helm of the company.

During the restructuring process, the creditors of Agroziv, among them NLB, converted their claims into ownership stakes, which turned NLB into one of the biggest owners of Agroziv.

The news comes after NLB's chairman Bozo Jasovic announced on Thursday that the currently debated EUR 250m capital increase would only be the first urgent step. Facing changes in EU legislation and EUR 600m to EUR 700m in hybrid capital due for payment in the coming years, NLB will need between EUR 400m and EUR 600m, he said.

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