Slovenia reportedly ready to move on privatisations

By bne IntelliNews May 7, 2013

bne -

The Slovenian government is reportedly looking to sell the country's largest telecoms operator, as well as the second largest bank, in a bid to shore up finances as it continues to battle to avoid an international bailout.

The recently-appointed government is struggling to adopt an economic reform programme for May 9, before presenting it to the European Commission. Ljubljana is seen missing this year's budget deficit target of 3% of GDP, despite managing to reduce the gap to 4% in 2012 from 6.4% the previous year. The European Commission forecasts the 2013 deficit will expand to 5.3%.

The Bank of Slovenia urged the government on May 6 to speed up privatisations in sectors where "the market is more effective than state ownership," but gave no details, reports Reuters. Slovenian banks, mostly state-owned, are seen as a particular focus, because they're nursing about €7bn of bad loans. Those non-performing assets will likely have to be separated off into a "bad bank" before the sector can be privatised.

A government source told the newswire: "the sale of Nova KBM is on the table." Meanwhile, according to an unconfirmed local media report, the coalition government of centre-left and pro-market parties is also considering the sale of Telekom.

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