Business News

NLB Capital Hike to Be Carried out in March

Ljubljana, 24 December (STA) - A EUR 250m capital hike at Slovenia's largest bank, NLB, will be carried out in March, the supervisory board said on Friday after the government withdrew its reservations about the plan.

The bank's strategy for the 2010-2015 period had been endorsed by the management and the supervisors in October, but the government expressed reservations in discussing its own strategy for the bank.

Yesterday, however, the government decided that the management and the supervisors were absolutely in charge of the bank's business decisions, effectively endorsing the bank's own strategy.

The bank's strategy combines the capital hike with the disposal of its stake in Banka Celje and withdrawal from several markets.

NLB reported a EUR 50m net loss for the first nine months amidst fresh writedowns on its loan portfolio, but the plan adopted by the supervisors today envisages a return to profitability next year.

Nevertheless, the supervisors expect further writedowns next year coupled with a weak economic recovery.

NLB sees 2012 and 2013 as recovery years, but it says the conditions will still be worse than before the onset of the financial and economic crisis.

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