Croatia may shortlist candidates for sale of bank, insurer
ZAGREB Oct 9 (Reuters) - The Croatian government, struggling to contain the growing budget shortfall and public debt, may shortlist on Thursday the candidates for buying the biggest local insurer and the last local bank in state hands.
Croatia, which joined the European Union in July, has invited investors to express interest in acquiring 99.13 percent of Hrvatska Postanska Banka (HPB) and some 50 percent of Croatia Osiguranje (CO).
"The government plans to consider the offers at its session tomorrow," a government spokesperson said on Wednesday.
According to the local media, the frontrunners expected to be shortlisted for HPB are Austria's Erste Bank and Hungary's OTP Bank. The local tobacco and tourist group Adris and Poland's insurer PZU are seen as the frontrunners in the race for CO's stock.
The government has said it hopes to earn around 2 billion kuna ($355.97 million) from the sale.
CO is the biggest local insurer with a market share of around 35 percent. The government owns some 80 percent of the company.
HPB controls around 4.5 percent of the local banking market, which is mostly in the hands of parent banks from Italy, Austria, France and Hungary.
Croatia is struggling with a fifth straight year without economic growth and the government is under pressure to cut the high public debt, which is seen surpassing 60 percent of gross domestic product (GDP) soon, and the general budget gap targeted at 3.5 percent of GDP this year.
($1 = 5.6184 Croatian kunas) (Reporting by Igor Ilic; Editing by Zoran Radosavljevic and Elaine Hardcastle)