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Slovenian deputy PM does not expect sale of NLB bank stake to go ahead
June 6, 2017 / 6:01 PM / 3 months ago

Slovenian deputy PM does not expect sale of NLB bank stake to go ahead

LJUBLJANA, June 6 (Reuters) - Slovenia will probably not go ahead with plans to sell a stake in the country’s largest bank, state-owned Nova Ljubljanska Banka (NLB), at present, Deputy Prime Minister Karl Erjavec said on Tuesday.

Slovenia had committed to sell 50 percent of NLB this year and another 25 percent in 2018 in exchange for the European Commission’s approval of state aid for the bank in 2013.

Privatisation coordinator Slovenian Sovereign Holding asked the government last week to set the price range for the planned initial public offering of NLB but Erjavec said he expected the government to decide against going forward with the sale at its session on Thursday.

“I believe the process of the sale will probably not continue,” Erjavec told reporters on the sidelines of a meeting of the governing coalition.

Erjavec, whose Desus party is a junior member of the coalition, signalled that he believed that the price likely to be achieved in the NLB sale was too low.

“The standpoint of Desus party is that the sale could go through if the price was right, if taxpayers would be repaid and if we would also earn something,” he said.

Erjavec had said previously that the sale should bring in at least 1.55 billion euros ($1.75 billion) - the size of the state capital increase for NLB in 2013 - but analysts believe Slovenia could at most get some 1 billion euros for the whole bank.

The European Commission has not revealed what steps it would take if Slovenia failed to sell NLB but a Commission spokesperson told Reuters that the EU executive was in contact with Slovenian authorities.

Slovenia has been reluctant to sell its major banks over the past decades so the government still controls about 45 percent of the banking sector. ($1 = 0.8870 euros) (Reporting by Marja Novak; Editing by Adrian Croft)

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