BRATISLAVA, May 17, (WEBNOVINY) — Slovakia will have to pay the first installment of almost EUR 132 million to the founding capital of the new European permanent rescue mechanism within 15 days of the date when the agreement on permanent European bailout fund and the law on the European Stability Mechanism (ESM) take effect. The Finance Ministry has already submitted the draft bill regulating Slovakia’s position within the new rescue mechanism for interdepartmental review. Slovakia should subsequently pay an additional, almost EUR 132 million to the rescue fund already this year. Then the Slovak Republic should settle further three installments in 2013 and 2014 at almost EUR 396 million, reads a clause on impacts to the draft bill on the European Stability Mechanism. To settle the first installment amounting to EUR 131.8 million state financial assets should be used without their additional boosting via an increase in resources for financing the state debt. “This subscription of capital paid up on call will not influence the deficit of public finances or the general government debt according to ESA 95 methodology. According to ESA 95 methodology the given sum will be recorded as a financial operation without influence on the gap of the public administration budget and the public debt,” reads the Finance Ministry’s draft.
As far as further installments of the founding capital and possible call for capital payment on demand it will be necessary to increase the volume of resources of state debt financing in line with the law on state debt and state guarantees of the Slovak Republic,” added the ministry.
Differently from the European Financial Stability Facility called also temporary bailout fund that worked on the basis of guarantees for issued bonds, members will contribute directly to the European Stability Mechanism by subscribing shares in the company’s share capital that will represent EUR 700 billion. Of this, EUR 80 billion will be in form of paid up shares and the additional EUR 620 billion in the form of stock payable on call.
The Slovak Republic will have to pay its stake at EUR 659.2 million in five equal installments. The total sum of Slovakia’s stake in the permanent rescue mechanism will stand at EUR 5.768 billion. The remaining capital will paid on call.
SITA
