ZAGREB, March 29 Financial difficulties at
Croatia's biggest private company Agrokor will not
destabilise the banking system, the country's central bank
governor said on Wednesday.
Food producer and retailer Agrokor, whose revenues are
equivalent to 15 percent of Croatia's gross domestic product, is
laden with debts of 45 billion kuna ($6.5 bln), according to
latest data, or six times its equity.
"Croatia's banking system is strong enough to face the
toughest situations and it will remain stable despite the
developments with Agrokor," central bank Governor Boris Vujcic
Croatia's banking system benefited from banks' very high
average capital adequacy ratio of 23 percent, he said.
Agrokor has been in debt restructuring talks with its
creditors, most notably Russia's Sberbank, its top
According to local media reports, unconfirmed by Agrokor or
Sberbank, a deal on a liquidity injection could be finalised in
the coming days.
A major portion of debt, worth 500 million euros ($537 mln),
matures early next year.
The Croatian government is working on a new law aimed at
shielding the economy and the financial system from the risks
of a major corporate failure.
Prime Minister Andrej Plenkovic said on Wednesday the draft
law could be approved at a cabinet session on Friday.
($1 = 6.9219 kuna)
($1 = 0.9309 euros)
(Reporting by Igor Ilic; Editing by Susan Fenton)