The Croatian National Bank today introduced special administration in the Craftsmen’s Savings Bank d.d. Zagreb to prevent further deterioration of its operations and to protect the interests of depositors and other creditors of this savings bank, it was announced by the HNB.
Anri Jurčec from the Croatian National Bank was appointed as the president of the special administration, and Dean Balint from the State Agency for the Protection of Deposits and Bank Rehabilitation was appointed as a member of the administration. At the end of September this year, the Craftsmen’s Savings Bank had total assets of 123.9 million kuna, representing a share of 0.03 percent of the total assets of the Croatian banking system. The bank’s guarantee capital amounted to 6 million kuna (the legally prescribed minimum is 8 million kuna), and the operating loss was 3.7 million kuna. The special administration was appointed after the Craftsmen’s Savings Bank failed to implement a series of measures mandated by the HNB to stabilize its operations.
Specifically, the central bank states that as early as the end of last year, HNB supervisors noticed negative trends in the savings bank’s operations that were assessed to potentially become an obstacle to its financial stability and viability if not addressed. In light of this, the HNB conducted consultations with the bank’s management and supervisory board multiple times during 2009 and 2010, warning them of the necessity to stabilize operations and the need for urgent recapitalization. However, the management did not take the necessary steps, leading to the adequacy of the guarantee capital falling below the legally prescribed minimum rate. The HNB then instructed the savings bank to implement appropriate measures to urgently restore the adequacy of the guarantee capital to the legally prescribed minimum.
