The Zagreb City Assembly adopted a proposal on Thursday for the city administration to take a short-term loan of HRK 400 million with a repayment period of 12 months to maintain budget liquidity.

The motion was carried by 27 votes in favour, 8 against and 6 abstentions.

The loan will be taken from a consortium of banks – Zagrebacka Banka,  OTP Banka, Privredna Banka Zagreb, and Erste & Steiermärkischebank – with a fixed interest rate of 1.4% and a maturity of no later than 30 July 2022.

Mayor Tomislav Tomasevic said that he would rather not take the loan but that it was necessary.

“We are taking this loan to ensure liquidity. I don’t know who could be surprised by this seeing that all the candidates in the mayoral race clearly spoke about situations in which material costs were not covered for kindergartens, theatres, schools and so on, because of cash flow problems,” he said explaining the decision to take the loan.