Slovenia Seeks Greater State Role in Economy Via Banks, Insurers

Slovenia wants to keep control of its largest banks and insurers to increase its grip on the nation’s financial industry and the economy, Finance Minister Franc Krizanic said.

Prime Minister Borut Pahor’s government will keep control of the country’s two largest banks, Nova Ljubljanska banka d.d. and Nova Kreditna Banka Maribor d.d., as well as in the four main insurers, including the largest Zavarovalnica Triglav d.d. Krizanic said today as the Cabinet presented a plan for managing state assets.

“It’s about three very important financial institutions that wish to remain independent,” Krizanic told reporters in Ljubljana. “The state’s role may eventually drop to a controlling stake of 25 percent plus one share while possibly seeking strategic partners for these companies. We will thus have a similar system as in western European countries.”

Slovenia, the first post-communist country to adopt the euro in 2007, has been reluctant to sell state-owned assets on fears of losing its economic independence. The country of 2 million residents needs to reduce the state’s role in the economy to speed up its recovery, the Organization for Economic Cooperation and Development said in February.

The export-driven economy, which contracted the most among the euro-region members in 2009, will expand at a slower pace than previously forecast. The government’s economic institute sees gross domestic product growing 2.2 percent this year from the previous estimate of 2.5 percent made last year.

Nova Ljubljanska and Nova Kreditna, in which the government holds an indirect majority, control over 40 percent of the Slovenian banking industry market in terms of assets. Triglav insurer holds a 36 percent of the Slovenian insurance market.

Slovenia joined the Paris-based OECD of 34 wealthy nations last year.

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