European Commission initiates investigation against Slovenia over NLB Bank

The European Commission has initiated an investigation against Slovenia over the suspicion that it has intervened in Nova Ljubljanska Banka (NLB), counter to the rules and the obligations imposed by the Union. Furthermore, Slovenia is under investigation because it has given up on the sale of NLB Bank, counter to its agreement with Brussels.

The deadline for the sale of 50% of NLB Bank expired on December 31, 2017. Also, Slovenia failed to propose a trustee for the sale of foreign business entities, NLB's subsidiaries, in the Balkans before November 31, 2017, says the EC, which will carry out a process against Slovenia over the violation of the EU agreement on state help.

The decision to open the investigation points to the aid provided to NLB by the Slovenian government, which Brussels suspects runs counter to the Union's rules, and which amounts to a total of EUR 1.6 billion.

If Slovenia is found guilty of violating the rules regarding aid provision in the case of NLB and if the European Court, as the final instance in the disputes between the Commission and the members, so decides, NLB would have to return the money, which would bring its solvency into question.

Regarding the initiation of the investigation of the EC against Slovenia, the Slovenian newspaper Finance also considers the scenario by which the Commission might order Ljubljana to sell over 50% of NLB's capital.

Five years ago, the EC deemed the interventions of the Slovenian government in NLB to be a form of state help, but didn't dispute them, as Slovenia had justified them with the bank's importance to the national economy.

EUROPEAN COMMISSION Bruxelles

Nova Ljubljanska banka d.d. Ljubljana

Nova Ljubljanska Banka

NLB Bank

European Commission

sale of NLB Bank

privatization of NLB Bank

Government of Slovenia