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Buiness Briefs

Slovak Telecom head Hubinák steps down
Central bank revises monetary targets for 2000
Slovak Credit Bank fails to pass liquidity test
SLSP reports record losses for 1999
ŽSR changes get go-ahead from management

Slovak Telecom head Hubinák steps down

Head of state-owned Slovak Telecom (ST) Emil Hubinák announced his resignation from the post of ST general director May 22 after a special session of the ST board of directors.
The board asked Minister of Transport, Postal Services and Telecommunications Jozef Macejko to convene a special shareholders' meeting of ST to discuss the departure of Hubinák from his posts as head of the board of directors of ST, EuroTel, member of the Poštová Banka supervisory board and Edivan company.
An official statement from ST did not give Hubinák's reasons for resignation. However, it is believed that the move came after disagreement over the planned increase of registered capital of Poštová banka in which ST would have to take part.
"Some may disagree, but we have saved large sums of money for ST in the past year...I do not agree with the company losing this money through an unsound investment," the daily Sme reported Hubinák as saying.
Hubinák was replaced by Štefan Bugár, previously head of the telecommunications system at the General Staff of the Slovak Army. He also worked with AT&T in 1993 and, since 1998, has been vice-chairman of Slovak Telecom's board of directors and head of operations at Slovak Telecom.


Central bank revises monetary targets for 2000

In line with a change in the basic parameters of the monetary program of the National Bank of Slovakia (NBS), the NBS Banking Board slightly revised its targets for the bank's monetary policy in 2000 May 19.
NBS spokesman Ján Onda said that after considering economic and monetary developments in 1999 and the development for the first two months of 2000, the targeted annual core inflation should move between 4.7 and 5.8%. He added that with 2.5% GDP growth and the maintenance of a relatively stable exchange rate of the crown to the euro and the dollar, the NBS estimates inflation at the end of the year at 8.8 to 9.9%.
The fiscal deficit should not exceed 28 billion crowns - 3.3% of GDP.


Slovak Credit Bank fails to pass liquidity test

The central bank May 19 declared Slovenská Kreditná Banka (SKB) unable to pay out deposits and hence illiquid. NBS spokesman Ján Onda said that following liquidation, about 600 million crowns would not be paid off to private individuals because their deposits exceed 322,000 crowns - the maximum amount that can be guaranteed by law. Ninety million crowns from deposit certificates will also remain unpaid.
SKB was put under forced administration on April 19 after the bank dropped below liquidity requirements and an investigation was launched into financial mismanagement at the bank.
The biggest shareholders in SKB are Slovenský plynárenský priemysel, Vodohospodarská výstava, Slovenské lodenice Komárno and Transpetrol.


SLSP reports record losses for 1999

According to Slovak accounting standards, Slovakia's largest bank, Slovenská Sporiteľňa (SLSP), posted a record loss of 5.678 billion crowns for last year. However, under international accounting standards the bank managed to finish the year in the black.
The bank said that the 1999 result stemmed from the creation of provisions and reserves of 1.03 billion crowns, costs related to general operating activities (4.58 billion crowns) and writing off irrecoverable claims (1.84 billion crowns). Total costs amounted to almost 51.5 billion crowns, with financial operations costs at 22.74 billion crowns.
After deduction of provisions, the volume of SLSP's provided loans stood at 61.72 billion crowns with its share in the loan portfolio of the Slovak banking sector at 17.34%.
SLSP also undertook a capital raise of 4.3 billion crowns, bringing its registered capital to 6.37 billion crowns at the end of the year.


ŽSR changes get go-ahead from management

Slovak Rail (ŽSR) management on May 19 approved a transformation plan that will see the current state-owned company split into two - ŽSR a.s. and Železničná spoločnosť (ŽS-Rail Company).
ŽSR spokesman Miloš Čikovsky said that ZSR a.s., to be launched January 1 2001, would ensure the gradual economic consolidation of the company and would be the main operator of cargo and passenger transport. It will consist of the senior corporate control body, the General Directorate, and four sub-divisions: the Division of Road Transport, the Division of Rolling Stock, the Division of Passenger Transport and the Division of Cargo Transport.
Železničná spoločnosť (ŽS-Rail Company) would provide maintenance and other railtrack services for ŽSR a.s.


Compiled by Ed Holt from SITA

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