Aid granted by the state for the Romanian Commercial Bank (BCR) privatisation may include new elements, such as a 500 million-dollar sum in the form of guarantees, issued in favour of Arab states before 1989, by the former Banca de Comert Exterior (Foreign Trade Bank).

The Minister of Public Finance, Sebastian Vladescu, yesterday told a meeting of three Senate committees that Banca de Comert Exterior, which later became Bancorex, had issued guarantees worth 500 million dollars in favour of Arab states before 1989. The obligations related to the guarantees may be inherited by the BCR, which took over Bancorex in 1999.

"It is difficult to make an accurate assessment of BCR's obligations. Before 1989, Bancorex issued unlimited (in time) guarantees worth some 500 million dollars in favour of the Arab states, although I do not know what they cover," Vladescu told the joint session of the Budget-Finance-Banks Committee, the Legal Committee and the Privatisation Committee of the Senate.

According to Vladescu, it is possible for an Arab state to request the payment of a guarantee, although so far there has not been such a request.

"There is no clear assessment because the data we have is contradictory. There are aspects of Bancorex's activity that elude us," said Vladescu.

In late July, the Minister of Finance had estimated the potential state aid for Bancorex at 900 million euros. Bancorex was absorbed by the BCR in 1999. Vladescu stressed that these figures were just estimates.

In December 2005, Austrian-based Erste Bank successfully bid for the BCR, the biggest bank in Romania. Erste offered 3.75 billion euros.

According to Erste, the last requirement that needs to be met by the Romanian party for BCR's privatisation process to be completed is endorsement of the transaction by Parliament. Aid granted by the state for the Romanian