Due to aggravated economic conditions, which strongly affect operations of the Bank, the Management Board of Nova KBM d.d. proposed the revised 2009 business plan. According to estimations of the Statistical Office, the Slovene gross domestic product (GDP) in the second quarter of 2009 was in real terms 9.3 per cent below the figure of the same period of last year. The Institute of Macroeconomic Analysis and Development foresees a 4 per cent drop of the Slovene GDP by the end of 2009. When initially drafting the business plan for 2009, the ECB key interest rate of 2.25 per cent valid in December 2008 as well as projections from the end of last year that the interest rate will marginally decrease or even remain at the same level were taken into account. However, the current ECB interest rate determined in May stands at 1 per cent.
According to the revised business plan, the total assets of the Bank and the Group are to remain approximately as originally planned (€5.8 billion for the Nova KBM Group and €4.8 billion for Nova KBM d.d.), while the net profit is to be lower due to increased impairment charges and provisions. The Nova KBM Group and Nova KBM d.d. will make impairment charges and provisions of €56.3 million and €47.3 million, respectively.
The economy is confronted with lower investments, deteriorated performance, drop in consumer consumption and increase in the level of unemployment. Therefore, the Nova KBM Group and Nova KBM d.d. give preference to stability over growth in accomplishing this year's business objectives, taking into account economic and financial market conditions.
Management board of Nova KBM d.d.
