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Hypo Alleged of Having Hoarded Assets of Former Serbian Regime

Published: December 6, 2013; 18:13 · (Vindobona)

A Serbian NGO suspects assets of former Serbian President Slobodan Milosevic at Hypo Group Alpe Adria. The Austrian bank strongly rejects this allegation.

Hypo Alleged of Having Hoarded Assets of Former Serbian Regime / Picture: © Hypo Alpe-Adria-Bank International AG

The Balkan anti-corruption authority has forwarded the respective documents to the Serbian judiciary. After the change of the regime in the year 2000 assets were transferred to a secret account at Hypo Group Alpe Adria where it was used for credit protection. However, the Austrian bank strongly rejects the claims. “Because of the alleged volume (of assets) alone such an operation can be rules out,” Nikola Donig, spokesman at Hypo Group, said. A total of € 18bn was transferred to the Austrian bank, according to the anti-corruption league.

The NGO also burdens the former President of the Central Bank and former Finance Minister Mladjan Dinkic. According to member of the anti-corruption league Darko Trifunovic, Dikic discovered the assets in Cyprus. However, they were not transferred to the budget but to a secret account at Hypo Group and was used as a guarantee for credits used by Serbian businesspeople; yet, the loans taken out have never been paid off. By reffering to forensic investigator of Hypo Group Christian Böhler, Trifunovic claims that an amount of around € 18bn was transferred to Hypo Group.

In the 1990s the regime of Milosevic has shifted assets from the Serbian National Bank to Cyprus. Because of the sanctions by UNO the financial means were transported out of the country. Dinkic has be claiming that his researches in Cyprus were unsuccessful. Long-term financial manger of the former Serbian President, Borka Vucic, who had repeatedly denied the existence of assets in Cyprus died in a car accident in 2009.

Currently, a debt cut at Hypo is under consideration as some representatives of the Austrian Finance Ministry favor this step to decrease the debt rate of the Austrian state.

The main aim, however, is to make Hypo Group’s former parent company BayernLB liable since the German bank got away scot-free after the nationalization of its Austrian affiliate. The key issue for the state is the liabilities in connection with Hypo Group which the province of Carinthia would not be able to bear on its own.

According to daily Standard, the “main advantage compared to other options was that while with a bad-bank solution BayernLB had a greater say it would be immediately asked to pay with an insolvency.” According to the daily, the Finance Ministry is now considering to make one third of creditors waive their claims by offering them two papers with guarantees of the Republic of Austria instead of three bonds with guarantees of the province of Carinthia. By this debts could be reduced by one third which would prevent Carinthia from going bankrupt. Hypo Group denied knowing about such plans.

Both Chancellor Werner Faymann and his deputy Michael Spindelegger rule out an insolvency of ailing bank Hypo Group Alpe Adria. Chancellor Faymann referred to incalculable economic and political consequential effects.

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