UPDATE 1-Slovenian bank shares trading halted before stress test results
(Updates with central bank statement)
LJUBLJANA Dec 2 (Reuters) - Slovenia's stock market suspended trade in its banks' shares and junior bonds on Monday, to pre-empt excessive volatility, until after banking stress test results next week that will decide if the country needs an international bailout.
The Ljubljana Stock Exchange halted trading Slovenia's three biggest banks: Nova Ljubljanska Banka (NLB), Nova Kreditna Banka Maribor (NKBM) and Abanka Vipa, as well as Banka Celje, Factor Banka and Probanka.
In a statement emailed to Reuters, the bourse said it had made the decision due to speculation about different ways the government might overhaul the banking system and the possible impact on bank shares and junior bonds.
"Banks, the regulator and the state do not have all details and thus it is increasingly obvious that investors do not have all the information needed to make proper decisions and it is the obligation of any bourse to stop trading in such circumstances," it said.
It said the suspension would remain in force until those details become available.
The central bank said that the bourse's decision was a "precautionary measure".
"We assess that it is a precautionary measure based on public discussions and speculations about the results of the stress tests. In any case, it is not based on the business data of the exposed banks which result from the stress tests," the central bank said.
Slovenian banks, mostly state-owned, are nursing some 8 billion euros ($10.89 billion) in bad loans, which equals about 23 percent of the national output.
The test results, due on Dec. 13, will show how much new capital they need after a transfer of some 4 billion euros of bad loans to the state-owned "bad bank" later this year and in early 2014.
They should also indicate whether Slovenia, with a population of 2 million, can afford to manage the process of recapitalising the banks or will need to become the sixth euro zone economy to take an international bailout. ($1 = 0.7345 euros) (Writing by Maja Zuvela and Igor Ilic; Editing by Zoran Radosavljevic and Louise Ireland)
- Police hunt for motive as search for Malaysian jet spans hemispheres |
- Crimeans vote over 90 percent to quit Ukraine for Russia |
- Ukraine, Russia agree Crimea truce until March 21-Ukraine minister
- Malaysian PM says lost airliner was diverted deliberately |
- Democrats seek ways to limit Obamacare fallout after Florida defeat