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Busines Briefs

Volkswagen Slovakia opens Martin plant
FinMin opens talks with delinquent Devín banka
ŽSR signs Eurobond contract with JP Morgan
Central bank lowers repo rates by half percent
STV calls for representation on ST commission
Shell Slovakia reports five billion crown turnover

Volkswagen Slovakia opens Martin plant

At an opening ceremony May 29 Volkswagen Slovakia representatives said that the firm's new production unit in Martin would produce two million components and employ 450 people.
Volkswagen Slovakia has so far invested 10 million Deutsche marks in the purchase of a production hall, lots, and infrastructure. VW Slovakia Board Director Peter Wilhelm said that the company would invest 40 million Deutsche marks into new equipment and would transfer equipment from other plants.
The 20,000 square metre Martin plant will put out components for gearboxes, axles, and steering wheels for Volkswagens.


FinMin opens talks with delinquent Devín banka

In an effort to settle differences, the Finance Ministry opened talks with the Slovak-Russian owned Devín banka on May 25 aimed at settling a claim between the two on the recovery of Russian debt to Slovakia.
Finance Minister Brigita Schmögnerová said after the meeting: "We preliminarily agreed on a way of settling the relationship, which would strengthen this financial institution so that it meets all the financial indicators and prevent the bank from slipping into a liquidity crisis."
However, the minister rejected Devín banka's claim to a 20% commission for the recovery of the debt, since the bank had been unable to recover the full, contractually agreed-upon portion of the debt.


ŽSR signs Eurobond contract with JP Morgan

State-run Slovak Rail (ŽSR) and JP Morgan Securities Ltd. signed a contract on the arranging of a ŽSR eurobond issue May 25 for 155 million euros bearing an annual coupon of 8% and maturing in May 2007.
Large institutional investors from Germany, Great Britain, Austria and the US are expected to be interested in the issue.
Deputy Finance Minister Viliam Vaškovič said a successful issue would prevent the government having to bail out the heavily-indebted company.
The state provided a guarantee for the issue amounting to 200 million euros. JP Morgan representatives said the issue should be increased by 45 million euros to achieve the government-guaranteed volume in September, but that the increase would depend on market conditions.


Central bank lowers repo rates by half percent

The Bank Board of the National Bank of Slovakia (NBS) decided May 26 to decrease interest rates on one-day operations by 0.5 percentage points cutting the overnight rate for sterilisation operations from 7.5% to 7% as of May 29.
The rate for refinancing operations will decrease from 10.5% to 10% as of the same date. The Bank Board also set the two-week interest rate for standard two-week repo deals at 8.5%, also effective as of May 29, and valid for both refinancing and sterilisation operations.


STV calls for representation on ST commission

Public Slovak Television (STV) called on Minister of Transport, Postal Services and Telecommunications Jozef Macejko May 26 to add an STV representative to the commission coordinating the privatisation of Slovak Telecom (ST).
STV spokesman Vladimír Hák said that a letter with the request was presented to the minister by Luboš Jariabka from STV's management. Jariabka said that parliament has not accepted any of the proposed improvements in the Telecommunications Act submitted by STV, and that the issue of outstanding STV debts towards Slovak Telecom had not been resolved.


Shell Slovakia reports five billion crown turnover

Shell Slovakia reported a turnover of five billion crowns for 1999, doubling the figure for the previous year.
Company representatives said that the company's performance last year came after the consumer purchasing power fell with the government's package of economic stabilisation measures.
Shell Slovakia plans to open two new petrol stations this year with management saying that expansion in southeast Slovakia is a possibility.


Compiled by Ed Holt
from SITA

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