Four arbitration cases brought by banks against Croatia before the International Centre for Settlement of Investment Disputes (ICSID) in connection with the conversion of CHF-denominated loans were suspended on 30 June, the government and ten banks said in a joint statement on Monday.

The cases concerned the amended Consumer Credit Act and Credit Institutions Act based on which loans denominated in Swiss francs were converted into euro or kuna denominated loans. The conversion triggered a series of legal cases before different courts.

On 30 June, Intesa Sanpaolo Holding International, Privredna Banka Zagreb, Sberbank Europe and Sberbank d.d. Zagreb renounced the possibility of pursuing legal action in such cases, and Raiffeisenbank International and Raiffeisenbank Austria d.d. withdrew their case before the Commercial Court in Zagreb.

The joint statement was signed by the government and OTP Bank, Erste Group Bank, Raiffeisen Bank International and Raiffeisenbank Austria, UniCredit Bank Austria and Zagrebačka Banka, Intesa Sanpaolo Holding International and Privredna banka Zagreb d.d., and Sberbank Europe and Sberbank d.d. Zagreb.

The government said it appreciated the credit institutions’ constructive approach to unresolved issues and their recognition of the positive effects of the government policy aimed at aligning Croatian legislation with the EU’s acquis communautaire and adopting the euro as legal tender in Croatia.

The credit institutions acknowledged the government’s commitment to resolving the outstanding issues and the government’s efforts to create a stimulating business environment in the country.

Two arbitration cases, brought against Croatia by Addiko Bank AG and Addiko Bank d.d. and by Société Générale S.A., and a case initiated by Addiko Bank d.d. before the Commercial Court in Zagreb continue. The government, in cooperation with the State Attorney’s Office, will continue to take all the necessary steps to protect the interests of the state, the statement said.

Speaking at a press conference in February, Finance Minister Zdravko Maric said that thanks to the agreement reached with the banks, the potential payment of at least HRK 2.5 billion from the state budget was avoided, adding that HRK 482 million related to the lawsuits before the Commercial Court in Zagreb and about HRK 2 billion to the lawsuits before the ICSID in Washington.

Maric said that Croatia had paid HRK 127 million for court costs, the costs of lawyers and expert witnesses and similar costs for the cases before the ICSID.

(€1 = HRK 7.5)