Slovenia Will Need Aid If Bad Bank Plan Fails: Sustersic

Slovenia’s failure to fully implement a plan to clean up lenders’ balance sheets would probably force the nation to seek a bailout, Finance newspaper reported, citing former Finance Minister Janez Sustersic.

The best solution out of the political crisis sparked by corruption allegations against Prime Minister Janez Jansa would be early elections, Sustersic, who resigned from his post last month, was quoted as saying by the Slovenian business daily.

Slovenia devised a bank recapitalization plan that would take as much as 4 billion euros ($5.36 billion) in bad loans from lenders such as Nova Ljubljanska Banka d.d. in exchange for government-guaranteed bonds. An additional 1 billion-euro direct capital boost for banks would also be needed, Sustersic has said.

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