* Court orders Slovenia to reimburse savers in defunct bank
* Ruling marks end of 20-year dispute
* Reports suggest cost may run to 500 mln euros
By Marja Novak and Maja Zuvela
LJUBLJANA/SARAJEVO, July 17 Slovenia said on
Thursday it would comply with the European Court of Human
Rights' order that it reimburse clients of a now-defunct bank
who lost their savings when Yugoslavia collapsed, in another
blow to the country's fragile finances.
Estimates of Slovenia's liability range from 300 million to
500 million euros ($406 million-$676 million).
"It's always easy to be a general after the battle," said
central bank governor Bostjan Jazbec. "The decisions of the
1990s were probably well-considered, rational and the best
possible at the time," he told reporters.
"Thinking about them now would be a waste of time. We have
to accept the decisions of the court and hope that we can repay
our obligations as soon as possible."
Wednesday's ruling, the climax of 20 years of litigation
over lost savings in Ljubljanska Banka, comes at a bad time for
Slovenia, which is trying to claw its way out of a banking
crisis having narrowly avoided taking an international bailout
late last year.
Ljubljanska Banka was one of the leading banks in socialist
Yugoslavia, attracting depositors from across the federation.
But thousands of its depositors lost their savings in 1991
when Slovenia became the first republic to break away from
Yugoslavia, which then tumbled into civil war. The bank closed
its doors in 1991, without paying out savings to those outside
of the new state.
The ruling from the court in Strasbourg now gives European
Union and euro zone member Slovenia a year to find a way to
reimburse those depositors.
The country of 2 million people has just poured 3.3 billion
euros into its teetering banks after more and more loans soured
in the wake of the collapse of its export sector. It now needs
to sell off a raft of state firms and cut spending to bring down
its budget deficit.
Slovenia had long argued that the matter of Ljubljanska
Banka should be settled as part of succession talks between the
former Yugoslav republics.
The court also ordered Serbia to reimburse Bosnian
depositors of an estimated 60 million euros in a unit of Serbian
Monika Mijic, a Bosnian lawyer in the Strasbourg-based
court, said the verdict was "historic, and will mean the closure
of two decades of agony."
In a statement to Reuters, Slovenia's finance ministry said:
"We have to examine the verdict in detail before we can comment
on possible ways of executing the verdict. We cannot speak of
concrete figures at this moment."
The central bank's vice-governor, Stanka Zadravec Caprirolo,
suggested negotiations may follow.
"The effects will not be such that it would endanger
Slovenia's financial stability but the sums are not small...
They have to be paid," Caprirolo told reporters.
"I expect it will be possible to reduce the fiscal effects
in interstate talks."
($1 = 0.7392 Euros)
(Additional reporting by Zoran Radosavljevic in Zagreb; Editing
by Matt Robinson and Hugh Lawson)