Bloomberg News

Croatian, Slovenian Experts Reach Compromise on NLB Dispute

November 07, 2012

Croatia and Slovenia made progress in solving a banking dispute, stemming from the breakup of Yugoslavia, that has threatened to delay Croatia’s planned July 2013 European Union entry.

Zdenko Rogic and France Arhar, the two countries’ financial experts, reached a “compromise solution” that will be submitted to both governments, Vesna Pusic, Croatia’s Foreign Minister, told reporters in Zagreb today.

“The solution is not ideal for Croatia, but it’s reasonable,” Pusic said, declining to elaborate on details.

Croatia has barred Nova Ljubljanska Banka d.d., Slovenia’s largest bank, from operating in Croatia until the issue is settled over money owed to Croat savers from the bank’s Yugoslav predecessor. Croatia, which took over the debt, is seeking 270 million euros ($344 million) of former deposits held by about 300,000 former savers from Croatia. Slovenia said last month it will ratify Croatia’s EU membership only after the dispute is resolved.

Another 130,000 Croat savers, who after the breakup of former Yugoslavia chose not to transfer their claims to the Croatian government, are separately seeking about $204 million from the Ljubljana-based bank.

The European Court of Human Rights in Strasbourg yesterday ruled in favor of two Bosnian citizens who sued Slovenia for lost savings, setting a precedent for other former Yugoslav savers outside Slovenia who have been trying to recoup their money.

A form of “class action” litigation, the pilot-judgment procedure has been in use by the Court since 2004 and is a means of dealing with large groups of identical cases that derive from the same systemic problem.

To contact the reporter on this story: Jasmina Kuzmanovic in Zagreb at jkuzmanovic@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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