Guarantees approved for Srbijagas' EUR 190 million borrowing

Serbian lawmakers approved guarantees that allow the public company Srbijagas, the natural-gas monopoly, to borrow 190 million euros from seven banks and cover some of last year’s debts, Bloomberg reports.

Deutsche Bank and Amsterdam Trade Bank will together provide 70 million euros. Belgrade-based Volksbank will lend 70 million euros, Serbian units of Hungary’s OTP Bank, Societe Generale and UniCredit will put up 10 million euros each and Vojvodjanska Banka, a member of Greece's National Bank of Greece, will provide 20 million euros.

The loan is part of what the state-owned company plans to raise by the end of 2012, its general manager Dusan Bajatovic told lawmakers on November 6th.

"There will be another credit line worth 170 million euros” to cover this year’s debts, Bajatovic said.

Srbijagas owed more than 60 billion dinars ($678.98 million) to banks at the end of 2011, of which two-thirds were already long-term loans. The new, five-year loans come with a one-year grace period and quarterly debt repayments. The cost of new borrowing ranges from 5.98 percent and 7.25 percent on top of a three-month Euribor.