The Bank's liquidity position is adequate and its liquidity ratios comply with the regulatory requirements. The liquidity ratios are calculated and reported to the Bank of Slovenia on a daily basis. We would like to point out that the drop in the price of shares does not impact the performance of a company and does not lead to its bankruptcy, as suggested by the journalist in his commentary.
The price of a Nova KBM share is affected by many factors, with the Bank’s performance being only one of them. The recent downgrade of Slovene banks, including Nova KBM, and of Slovenia's sovereign rating definitely had an adverse effect on the price of KBMR shares. Further, the weak performance of the capital markets and the resulting lack of liquidity as well as the absence of appropriate economic measures at the national level also caused the price of a KBMR share to decline. The increase in share capital, which, in accordance with the decision of the June Shareholders' Meeting, is to take place by the end of the year, will cause the dilution in the value of existing shares, and this is another factor for the decline in the price of Bank shares. In addition, it needs to be pointed out that the price of a Bank share in the IPO was €27, which was 2.1 times its book value. The performance of Nova KBM shares, as well as its P/B ratio, was at that time in line with the performance of shares of comparable financial institutions in the region. As a result of the global financial crisis, the P/B ratio of these institutions now ranges between 0.2 and 0.7, which is comparable with that of Nova KBM.
The Bank has several times announced that it intends to undertake all necessary measures to improve its performance. These measures include the increase in capital and capital ratios, further cleaning of its loan portfolio, the renewal of its strategy, and the development of new and the upgrade of existing services. In accordance with the ruling made by the June Shareholders' Meeting, the activities related to the increase in capital and the sale of non-core assets are being carried out. The due diligence is in the final, i.e. technical stage, and an internal audit review of the Bank and some members of the Nova KBM Group will start shortly.
We believe that the yesterday's reporting of the Slovene National Television was very irresponsible and misleading. This applies also to the reports and articles about the Bank and the banking system in general, which were recently published or released by some other media. Such information causes unnecessary concern and mistrust among customers, shareholders and investors, and is damaging to the reputation of the banks and all their stakeholders.
In case of any further misleading or false statements in the media, the Management of Nova KBM will strongly consider a possibility to take all necessary legal actions in order to protect the interests of the Bank and its stakeholders.
Management Board of Nova KBM d.d.
