CEOL - Yugo Bank Group To Finance Gas Transit Via Hungary

BELGRADE, Oct 30, 1999 -- (Reuters) Thirteen Yugoslav banks on Friday set up a consortium to finance the transit of Russian gas through Hungary, but declined to be identified for fear of joining a list of officials banned from the European Union.

"The banks have agreed to finance $13.5 million worth of the gas transit costs through Hungary. A further $3.0 million will be financed from other sources," Milos Milosavljevic, chairman of the board of directors of the bank association and head of Jugobanka, told a news conference.

The agreement was reached at a meeting held behind closed doors and bankers left without comment.

"I do not want the name of my bank in any report," said one banker who asked not to be named.

Serbian bankers and businessmen are afraid mention of their names in media could get them put on a list of officials and individuals close to the government of Yugoslav President Slobodan Milosevic banned from travelling to EU countries.

The list, which also involves freezing the officials' assets in the EU, currently contains 308 names.

The independent Beta news agency reported earlier this week that Jugobanka, Beogradska Banka and Komercijalna Banka were among members of the consortium. Their directors are already on the list.

Milosavljevic declined to say which banks had joined the consortium with the task to service Belgrade's rescheduled debt to Hungary for transit costs. Local media have said the debt ranged between $20 and $25 million.

Deliveries of the gas, which Serbia agreed with Russia's gas monopoly Gazprom in September, started only 10 days ago after Budapest allowed the transit.

Hungary, an aspiring EU-member, had blocked the shipments for nearly a month of its own accord, insisting it wanted to comply with an EU fuel embargo against Yugoslavia, which never specifically mentioned gas.

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