On Friday, December 17, 1999 the Council of the Croatian National Bank gave its approval to Comit Holding International S.A. Luxembourg for acquiring a stake of 66.3 percent in Privredna banka Zagreb.

Having reviewed the submitted documentation the CNB Council concluded that Comit Holding International is under 100-percent ownership of the Italian bank Banca Commerciale Italiana (BCI) Milan which performs all its international operations through Comit. Also, the agreement between BCI and the State Agency for Deposit Insurance and Bank Rehabilitation, which holds the state's stake in PBZ, sets forth that BCI guarantees for all liabilities of the future majority owner of one of the largest Croatian banks. Pursuant to the Law on Bank Rehabilitation and Restructuring, this change in the ownership structure of the bank marks the end of the rehabilitation of Privredna banka Zagreb.

Considering all these factors, as well as the fact that, according to last year's financial reports, Banca Commerciale Italiana is one of the largest Italian banks (after mergers completed this year it has become part of the largest banking group in Italy), that international credit rating agencies have assigned it with high ratings and that Italy has been Croatia's leading trade partner for many years, the CNB Council decided that there are no obstacles to approving the takeover.

The CNB Council members expect that the entry of BCI in PBZ will have a positive impact on the strengthening of competitiveness and improvement of quality of banking services in the Croatian banking system and that it will enhance the modernization of bank management and operation technology. It is also expected that the entry will contribute to the strengthening of trade and financial relations of the Croatian economy with foreign business partners, which should be reflected in the growth of exports, employment and of the Croatian economy as a whole.