The government approved on Monday new €250 million loans at local banks for the state-owned power board Hep.

The company plans to take out a €250 million loan from Privredna Banka Zagreb and another €100 million loan from Erste & Steiermarkische Bank.

An official of the Ministry of Economy, Mile Horvat, told other ministers in a cabinet session that the repayment period for the two loans would be five years, and that they are meant to be used for “financing Hep’s investment projects.”

“The decision to take out the loans will not increase budget spending as they do not require government-vouched bank guarantees,” he said, adding that “HEP’s supervisory board agreed for the company to take out the loans at two sessions held in May and June.”