14 March 2000
In keeping with its strategic guidelines aimed of consolidation and
strengthening of its competitive position, Zagrebacka banka issued in early
February a letter of intent informing the Supervisory and Management Boards of
Varazdinska banka of its intentions.
In compliance with Article 27, item 1, of the Banking Act, Zagrebacka banka
filed on 24 February 2000 a request with the Croatian National Bank to obtain
its approval for acquisition of the Varazdinska banka shares amounting to 10%,
20%, 30%, 40% and 50% of the Varazdinska banka equity, as well as its approval
for the acquisition of a majority equity holding in Varazdinska banka as
stipulated by Article 29, item 1, of the Banking Act.
Zagrebacka banka considers this action as a friendly acquisition, and it will
to the largest extent possible observe the legitimate interests and rights of
the Varazdinska banka shareholders. It is the intention of Zagrebacka banka
that - after the acquisition of the equity stake in Varazdinska banka has been
successfully completed - Varazdinska banka keeps its name and corporate
identity, which will enable continuation of successful operations and
management of Varazdinska banka. Zagrebacka banka has paid a compliment to
Varazdinska banka by describing it as one of Croatia's best banks.
In the meantime, Zagrebacka banka has in the open market acquired an equity
stake in Varazdinska banka at an average price of HRK 200 per share. At the
date of this release, the Zagrebacka banka shareholding in Varazdinska banka
does not exceed 10% of the equity. The above transaction is yet another
indicator of the consolidation of the Croatian banking market.
The intended acquisition of a majority shareholding in Varazdinska banka is in
keeping with the plans of Zagrebacka banka not only to retain its leading
position in the local market but also to strengthen it through organic growth
Under a moderate pressure by competition, Varazdinska banka has been able in
the past to build up a respectable customer base in north-west Croatia, and in
the circumstances of economic recovery, this market is likely to grow above
The planned concentration creates favourable conditions for preserving the
national element in Croatian banking industry in the circumstances of
intensified competition from foreign banks. Today Zagrebacka banka is
practically the only bank in Croatia whose strategy is still decided at home.
ZAGREBACKA BANKA d.d.