Slovenia

Automotive industry supplier Cimos, one of the biggest companies in Slovenia, will undergo court-supervised debt restructuring after the major creditors decided against a debt-to-equity conversion by the Thursday deadline, the Slovenian news agency STA reported.

The receiver of the Slovenian subsidiary of Austria's troubled construction company Alpine Bau has admitted EUR 2.2m in claims and rejected EUR 28m, including EUR 13.5m worth of claims by Slovenian motorway company DARS stemming from the yet unfinished construction of a tunnel between the coastal towns of Koper and Izola, the Slovenian Press Agency (STA) reported. Read more. (Subscription required.)

Primož Kozmus is a Slovenian national hero lionised for tossing a hammer to double Olympic gold. Soon he might be forced to honour his Alpine homeland another way: sacrificing his personal fortune to help avert a eurozone bailout, the Financial Times reported. Slovenia’s banks are in such a dire state that Mr Kozmus is almost certain to face a so-called haircut, which will slice through the more than €100,000 of junior bank bonds he bought during Slovenia’s heady credit boom. “The money was safe and then they changed the rules,” said Mr Kozmus.

Slovenia's banks are weak and trust in the system is limited, Finance Minister Uros Cufer told parliament on Friday, as expectations grew that the country may need financial help from abroad, Reuters reported. Slovenia's banks are crippled by at least 7.5 billion euros ($10 billion) of bad loans - more than a fifth of national output - with stress tests set to reveal in November how much help the sector will need.

Slovenia's largest retailer Mercator has appointed advisers to help with a 1 billion euro debt restructuring, according to finance industry and banking sources close to the negotiations, Reuters reported. The restructuring is a condition of a proposed sale of a 53.12 percent stake in Mercator to Croatian food and retail group Agrokor. In June, Agrokor said it would pay pay 120 euros per share for the food retail group, valuing the company - Slovenia's largest employer - at about 452 million euros.

Slovenia, a small euro-zone state that has recently caused major headaches for the European Union, has settled on a series of measures aimed at boosting tax revenue and stabilizing its public finances, The Wall Street Journal Emerging Europe blog reported. Its government said Thursday it would generate 200 million euros ($266 million) a year from fresh taxes by fighting the grey economy. The cabinet approved a plan to clamp down on tax evasion, curb undeclared employment, limit large, undeclared cash payments and other similar steps.

Slovenia’s recently formed Bad Asset Management Company, or DUTB, will receive its first batch of non-performing loans from the country’s state-owned lenders by end-June, clearing the way for the privatizations slated to help this small euro-zone member avoid an international bailout, The Wall Street Journal Emerging Europe blog reported. “The first transfer will total about 2 billion euros ($2.67 billion),” Simona Rodez, a DUTB spokeswoman told The Wall Street Journal.

Bad loans in Slovenia's largest banks amount to almost a fifth of all their loans, the country's central bank said on Tuesday, adding that a planned capital hike of 900 million euros should suffice to keep them afloat, Reuters reported. The central bank's Vice Governor Stanka Zadravec Caprirolo said that the planned amount should be "absolutely sufficient" even beyond 2013. The central bank said that bad loans in the country's largest banks, in which the state has a stake, amount to 18.3 percent of all loans.

The Slovenian economy continued to shrink in the first quarter this year as the small euro-zone nation battled slumping demand for its exports of cars, pharmaceuticals and household appliances, caused by the ongoing economic downturn in Europe’s common currency bloc, The Wall Street Journal Emerging Europe blog reported. First-quarter gross domestic product contracted 3.3% from the final three months of last year, and slipped 0.7% on the year, the national statistics bureau said Friday.

Slovenia needs at least €900m ($1.15bn) by July to refloat one of its struggling banks. This is a large sum of money for a country with a GDP of only €35bn. The question is where to find the funds, The Guardian reported. The public deficit is deepening and investors are beginning to question the country's solvency, to such an extent that it can no longer borrow on the money markets. On 30 April Moody's, the credit-rating agency, downgraded Slovenian bonds to junk status. Both Brussels and the OECD are urging the government to take action. But why is there such a hurry?