Debt of Institute Dr Simo Milosevic Toward Jugobanka AD in Bankruptcy Still Poses Real Danger Even Despite Two States’ Protocol

The signing of the protocol on cooperation between the ministries of finance of Serbia and Montenegro has not solved the problem of the debt of the Institute “Dr Simo Milosevic” toward Jugobanka AD in bankruptcy, that is, toward the Deposit Insurance Agency, because it is the responsibility of the Agency for Protection of Competition to examine the legality of this procedure.

As the executive manager of the Institute, Zoran Kovacevic, said on the TV show “U cetiri oka” on RTHN, the Ministry of Finance of Montenegro, in its new mandate, addressed the agency for an opinion about whether the move is in line with the Law on State Assistance and the Law on Protection of Competition.

– The director of the Agency for Protection of Competition has a questionnaire for the Ministry of Finance in the sense of the preparation of answers, that is, giving an opinion about the inquest that they got in line with the law. Ahead of the holidays, the Ministry of Finance forwarded the questionnaire to us, to fill out our part, which we are currently working on, but the Jugobanka debt is de facto not solved – he emphasizes.

The mixed ownership of the Institute is blocking the solving of this issue, Kovacevic says, but Montenegro, if it became a two-thirds owner, could get an additional recapitalization on the basis of the solving of the debt toward Jugobanka.

– According to that model, the state would no longer help. Instead, through solving the debt toward Jugobanka, it would increase its capital stake. In other words, it would buy shares and increase its stake and the value of the property it has in the Institute – says Kovacevic.

By buying out the shares, the state would increase the value of its capital by considerably more than the amount with which it would pay for the shares, and as the majority owner, it would have the opportunity to make its own decisions and have the property at its disposal.

Due to the debt toward Jugobanka, at the beginning of December, the account of the Institute was blocked for a short time, but that is still a real danger.

– There is a legal basis for us to seek the postponement of the blocking for one month, citing social and health vulnerability, which de facto exists, health vulnerability due to the rehabilitation of Montenegrin patients, social vulnerability due to the 550 employees. On that basis, I believe we have the right to one or two more postponements, which we will certainly do, but that is not a solution, but putting the problem aside – he said.

Kovacevic expects the decisions to be made which will remove part of the danger due to the blocking related to the debt toward Jugobanka through talks with representatives of the Government, which should be held soon.

Ministry of Finance of Serbia

Ministry of Finance of Montenegro

Jugobanka AD Beograd in bankruptcy

Institute Dr Simo Milošević Igalo

Deposit Insurance Agency

Agency for Protection of Competition

Zoran Kovačević