Ten arrested for banking irregularities worth 10 percent of Bosnia's budget
31/03/2016 11:56
SARAJEVO, March 31 (Reuters) - Bosnian police arrested 10
people on Thursday suspected of criminal activities which cost
the country's banking sector around 123 million Bosnian marka
($71.2 million) or over 10 percent of the central government's
budget.
Now defunct Bosnian lender Bobar Banka, based in Bosnia's
autonomous Serb Republic, was shut late in 2014 after its
shareholders failed to come up with a recovery plan after big
losses were found.
Clients, including major state firms, were at risk of losing
some of their 250 million marka in deposits.
The police operation was carried out on orders of the state
prosecutor in the towns of Banja Luka, Bijeljina and Zvornik,
the State Investigation and Protection Agency (SIPA) said in a
statement.
"The individuals, acting as an organised criminal
enterprise, are suspected of committing a series of
irregularities in the business operation of the Bobar Banka by
extending multi-million loans and illegal collaterals to
different businesses," the state prosecutor's office said in a
separate statement.
The suspects are believed to have made illegal gains in the
amount of 123 million marka, which account for more than 10
percent of the overall state institutions' budgets, it added.
Problems in the bank, based in the northeastern town of
Bijeljina, were reported after its majority owner Gavrilo Bobar,
a former Bosnian Serb businessman and member of the region's
parliament, died.
The suspects mainly extended loans to companies from its
owner's business group, also named Bobar and to bank's
shareholders, which were late with payments, according to the
prosecutor.
The Serb Republic banking sector posted a loss of nearly 80
million marka in 2015, down from 28.1 million marka profit in
2014, its worst result in five years, according to the region's
banking agency's preliminary data.
Tackling the problems in the Serb Republic's banking sector
is a key condition set by the International Monetary Fund to
resume talks on a new loan arrangement for Bosnia, after its
previous loan deal expired in June last year, officials have
said.
(1 = 1.727 Bosnian marka)
(Reporting by Maja Zuvela; Editing by Daria Sito-Sucic and
Jeremy Gaunt)
((maja.zuvela@thomsonreuters.com; +387 33 295 485; Reuters
Messaging: maja.zuvela.thomsonreuters.com@reuters.net))
Keywords: BOSNIA ARRESTS/BANKING