Solution found for RBV - Transfer of property and obligations to Vojvodina Development Fund

The governments of the Republic of Serbia and the Autonomous Province of Vojvodina have signed an agreement that should be a solution to problems concerning the Development Bank of Vojvodina (RBV), Tanjug news agency reports.

Under the agreement, the status of the RBV should be resolved by transferring assets and liabilities to another bank, or the Vojvodina Development Fund, the Serbian government's media relations office said in a release Thursday.

The agreement envisages the transfer of assets and liabilities to a bank that offers the best conditions for the transfer, in line with the Law on the Assumption of Assets and Liabilities of Banks for the Purposes of Safeguarding Stability of the Financial System of the Republic of Serbia.

The sum in question is close to about EUR 110 million of insured deposits and nearly 100 million of uninsured deposits belonging to about 80,000 depositors, the release said.

All depositors of the Development Bank “can be completely at ease because their funds deposited in the financial institution so far are completely safe and secured,” according to the release.

The agreement envisages that five-year bonds worth about EUR 70 million will be issued to cover the amount of uninsured deposits not covered by high-quality assets of the bank. Vojvodina should issue 78.11 percent, while the Republic of Serbia should issue the remaining 21.89 percent of the bonds.

These bonds can be traded on secondary markets, the release said.

The agreement also provides for the establishment of the Development Fund of Vojvodina on an expedited basis. When it comes to management rights, Vojvodina and Serbia will participate with 78.11 and 21.89 percent, respectively.

It was also agreed that the province should initiate an urgent adoption of a bill on the Vojvodina Development Fund.