Ljubljana, 10 February (STA) - The group around Slovenia's largest bank NLB last year generated a EUR 202.2m loss before tax, which is over two times more than in 2009, when the loss stood at EUR 86.8m. The loss is a consequence of EUR 477.3m worth of write-downs and bad loan provisions, NLB said on Thursday.
In the last quarter of 2010, the group posted a EUR 152.7m loss, while impairments and provisions stood at EUR 225.9m.
The bank's capital adequacy at the end of 2010 stood at 10.2%, which is 0.5 percentage points less than at the end of 2009. Tier 1 capital was at 6% or 0.9 percentage points down on 2009.
"Business operations in 2010 were marked by the economic crisis, which strongly affected the clients," said chief supervisor Marko Simoneti, adding that this had lowered the quality of portfolio and, consequently, increased the amount of provisions and impairments.
Besides provisions and impairments, also contributing to the loss were write-offs of securities available for sale and of capital investments in dependent companies.
The loss at the core bank NLB last year stood at EUR 183.4m, which compares to a EUR 23.6m in 2009, when impairments and provisions amounted to EUR 376.8m.
In the last quarter, the bank generated a EUR 150.6m loss and had EUR 199.2m in write-downs and provisions.
The results were discussed today by the NLB supervisors, who approved the planned EUR 250m capital injection for boosting the bank's capital adequacy in line with NLB's strategy for the 2010-2015 period. The injection is to be completed by the end of March.
The bank is to issue a maximum of 2,155,173 new ordinary shares with voting rights, with the emission price of EUR 116 per share.
Shares will be sold in two rounds. Only the existing shareholders will have the right to subscribe to new shares in the first round, while in the second round the remaining shares will be offered to all Slovenian and foreign companies or individuals.
Claude Deroose, the representative of Belgian KBC group, which holds a 30.57% stake in NLB, meanwhile tendered to the supervisory board his resignation from the bank's five-member management.
KBC chairman Jan Vanhevel told the press in Brussels today that negotiations on the capital injection at NLB were still under way and that KBC's relations with the Slovenian Finance Ministry and the government were good.
He added that KBC would have to seek approval from the European Commission in case it decided to contribute to the capital injection.
He was responding to reports in the Slovenian media that the negotiations were deadlocked and that KBC would not participate in the capital injection. In that case the stake of the state and affiliated owners in NLB would increase from 48% to 60%.