Help for citizens afflicted by natural disasters

Serbian Minister of Finance Mladjan Dinkic said that the government decided on the formation of a Coordinating Body for directing activities in damage relief work amidst landslides on the territories of municipalities Trstenik and Brus.

He said that this body comprises six ministers led by Minister of Capital Investment Velimir Ilic. He recalled that in the past two weeks 370 million dinars have been granted as emergency aid for the affected areas.

Dinkic pointed out that all the budgetary funds marked for damage relief caused by natural disasters in 2006 have already been spent, but that special funds will be provided and all threatened citizens taken care of.

Dinkic said that at the upcoming session of the government special funds will be approved, and the Ministry of Finance will examine the possibility of acquiring one more loan from the Council of Europe Development Bank.

He recalled that last year a soft loan was obtained from the bank for repairing damage caused by floods in Banat.

He also said that the government accepted today the Draft Contract according to which the recapitalisation of Komercijalna Banka by the European Bank for Reconstruction and Development (EBRD) will take place. Komercijalna Banka is one of the largest domestic banks.

He explained that the EBRD will pay €70 million for 25% of capital of Komercijalna Banka, thus becoming minority shareholder in the bank, while the state will still be majority owner with 50.7% of capital.

Dinkic said that the EBRD will enter Komercijalna Bank with a sum that is almost three times greater than the bank’s capital. He added that negotiations lasted six months and this transaction means that there is a possibility that Serbia will get a bank which can conduct business outside the country.

According to Dinkic, after the recapitalisation of Komercijalna Banka it will have a capital of €170 million instead of the current capital of €75 million, thus becoming the biggest bank in Serbia, not only according to savings deposits but also according to the amount of the banks capital. It will also be the first bank to apply for a license in Bosnia-Herzegovina in the beginning of April.