EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 19 December 2008 
at the request of the Slovenian Ministry of Finance  
on a draft decree laying down criteria and conditions for granting guarantees  
under Article 86.a of the Law on public finance 
(CON/2008/88) 
 Introduction and legal basis
 
On 3 December 2008 the European Central Bank (ECB)  received a request from the Slovenian Ministry 
of Finance (hereinafter the ‘Ministry’) for an opinion on a draft decree laying down criteria and 
conditions for granting guarantees under Article 86.a of the Law on public finance (hereinafter the ‘draft 
Decree’). The draft Decree was adopted by the Slovenian Government on 4 December 20081.  
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and on the sixth indent of Article 2(1) of Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions
2, as the draft Decree relates to rules applic able to financial institutions insofar as 
they materially influence the stability of financial institutions and markets. In  accordance with the first 
sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council 
has adopted this opinion. 
 1. Purpose of the draft Decree 1.1 The legal basis for the adoption of the draft Decr ee is the Law on public finance (hereinafter the 
‘Law’)
3 which provides for four categories of meas ures for limiting the effects of the global 
financial crisis in Slovenia and maintaining the st ability of the domestic financial system. One of 
these measures is the provision of State guarantee s to credit institutions for up to a total of 
EUR 12 billion. Article 88.a(1) of the Law require s the Government to adopt separate decrees for 
each of these measures setting out the criteria, c onditions and charges for their implementation. 
                                                 
1   Uredba o merilih in pogojih za izdajanje poroštev po 86.a členu Zakona o javnih financah , published in Uradni list 
Republike Slovenije  No 115/2008. 
2   OJ L 189, 3.7.1998, p. 42.  
3   Zakon o javnih financah , published in Uradni list Republike Slovenije  No 79/1999. The Law as last amended by the Law 
amending Law on public finance (Uradni list Republike Slovenije  No 109/2008). 
2 1.2 Solvent credit institutions which hold a valid licence to provide banking services issued by Banka 
Slovenije and which have their corporate seat in Slovenia are eligible for a State guarantee. State 
guarantees may be granted to those credit instituti ons which fulfil minimum capital requirements 
pursuant to the Law on banking4 but which, due to the effects of the global financial crisis, are not 
able, without State guarantees, to carry out borro wing transactions in the financial and interbank 
markets to finance their obligations and operating costs.  
1.3 The terms and conditions for borrowing by credit institutions subject to a State guarantee must be 
essentially comparable to those agr eed for borrowing by the State fo r similar types of transactions. 
Credit institutions must primarily use the funds obtained on the basis of a State guarantee for enhancing economic activities and ensuring appropriate credit for the support of the economy. The 
Ministry will lead the procedure for granting State guarantees and if it assesses that a credit 
institution fulfils the prescribed conditions, it w ill recommend that the Government should adopt a 
decision granting a guarantee. As the competent s upervisory authority, Banka Slovenije will give 
its assessment of the necessity and appropriateness of  granting a guarantee and it will be notified by 
the Government of the adoption of any decision granting a guarantee. A fee will be charged for 
guarantees. The fee will be calculated on the basis of the maturity of the guarantee and on a long-
term credit assessment of the credit institution by internationally recognised rating agencies. 
1.4 The draft Decree will be temporary and will apply until 31 December 2010.  2. General observations 
2.1 The ECB was consulted by the Ministry on th e draft Decree on 3 December 2008 and was asked to 
give priority to the consultation request as the pr essing need to adopt the draft Decree did not allow 
for a normal consultation period. No specific d eadline for the adoption of the ECB opinion was 
indicated and, notwithstanding the frequent inform al contacts between the ECB and the Ministry, 
the ECB was not notified of the advanced status of the adoption procedure. The draft Decree was 
then adopted on the day following the consultation of the ECB (on 4 December 2008), without any prior notification of the ECB. The ECB reiterates the position which it has previously communicated to the Slovenian authorities
5 that even cases of particular urgency do not abrogate 
the duty of the national authorities under Article 105(4) of the Treaty to consult the ECB on national draft legislative provisions falling within its fields of competence. The ECB would have 
welcomed being consulted on the draft Decree at  an earlier stage in order to ensure that the 
adopting authority would ha ve had sufficient time to take the ECB’s considerations into account. It 
follows from Article 3(4) of Decision 98/415/EC  that once a consultation request has been 
                                                 
4  Zakon o ban čništvu , published in Uradni list Repub like Slovenije  No 131/2006. The Law as last amended by the Law 
amending the Law on banking ( Uradni list Republike Slovenije  No 109/2008). 
5  See paragraph 2.4 of ECB Opinion CON/2008/76 of 25 November at the request of the Sloveni an Ministry of Finance on 
a draft law amending the La w on public finance, av ailable on the ECB’s webs ite at www.ecb.europa.eu.  
3 submitted to the ECB, Member States are obliged  to suspend the process of adoption of draft 
legislative provisions, pending receipt of the ECB’s opinion6. 
2.2 The draft Decree was adopted on the basis of  the Law on which the ECB issued its Opinion 
CON/2008/76. The ECB is now consulted on le gislation implementing the Law and the 
observations made in Opinion CON/2008/76 also apply to the draft Decree. 
 3. Specific observations 
3.1 Scope of the obligations covered by State guarantees 
 The draft Decree does not specify further which obligations may be covered by State guarantees. 
Pursuant to Article 86.a (4) of the Law, guara ntees may be granted to cover liabilities with a 
maturity of from 3 months to 5 years arising fro m borrowing in the financial or interbank markets 
which, for the purposes of the Law, comprise all lia bilities incurred by an e ligible credit institution 
towards other credit institutions and other fi nancial companies except liabilities arising from 
structured financial instruments, subordinated lia bilities of credit institutions and liabilities to the 
parent entity and its associated entities. In its Opinion CON/2008/76
7 the ECB recommended that 
the extension of State guarantees to cover interbank deposits should be avoide d in order to ensure 
effective implementation of the single monetary pol icy in the euro area. In  this respect, the ECB 
notes that further clarification regarding the scope  of the coverage of State guarantees is still 
needed.  
3.2 Charges  imposed on receiving credit institutions 
 Pursuant to Article 7 of the draft Decree, the am ount of the annual fee for a guarantee will be set by 
the Government in its decision granting the guara ntee. It will be based on a proposal by the 
Ministry taking into account the maturity of the guarantee and a long-term credit assessment of the credit institution by internationally recognised  rating agencies. In its Opinion CON/2008/76
8, the 
ECB emphasised that it is crucial to ensure the coordination of the pricing of State guarantees 
within the euro area and the EU, given that a level playing field is of the essence. The price of a 
State guarantee should be risk-based and market-orien ted, and determined on the basis of the costs 
of a corresponding guarantee in the market. In this respect, the ECB appreciates the additional 
information provided in the Annex to the draft Decr ee. It is important that the pricing of a State 
guarantee should link the level of charges to be pa id by a credit institution receiving a guarantee to 
the residual maturities of the guaranteed obligatio ns with maturities exceeding one year. The ECB 
also stresses the need for further harmonisation within the euro area which will be conducive to 
                                                 
6  See Title IV, Section 1 of the Guide to consultation of the European Central Bank by national authorities regarding draft 
legislative provisions, available on th e ECB’s website at www.ecb.europa.eu . 
7  See paragraph 3.3 of Opinion CON/2008/76. 
8  See paragraph 3.4 of Opinion CON/2008/76. 
4 ensuring that State support measures do not negatively affect the single monetary policy of the euro 
area9. 
3.3 Central bank involvement in the support measures 
 The ECB understands that Banka Slovenije will be  responsible for various tasks for implementing 
the measures under the draft Decree. In line with  its previous opinions, the ECB reminds the 
Slovenian authorities that the tasks performed by Banka Slovenije must comply with the monetary 
financing prohibition under Article 101 of the Tr eaty and Council Regulation (EC) No 3603/93 of 
13 December 1993 specifying definitions for the a pplication of the prohibitions referred to in 
Articles 104 and 104b (1) of the Treaty10. 
Banka Slovenije will process applications submitted by cr edit institutions requesting a State 
guarantee, ensuring priority treatment. Moreover,  Banka Slovenije will assess the necessity and 
appropriateness of granting a guarantee and indi cate whether the credit institution concerned is 
eligible for the guarantee under the Law and the dr aft Decree, and whether the grant of a guarantee 
is the most appropriate measure for achieving the aim of the Law11. 
The ECB emphasises that the tasks to be performed  by Banka Slovenije must comply with the 
above prohibition of monetary  financing as regards their remuneration.  It is also expected that tasks 
to be performed by Banka Slovenije for the bene fit of the State support measures will be conducted 
in a manner fully compatible with Banka Slove nije’s institutional and financial independence 
which is a safeguard for the proper performance of the Banka Slovenije’s tasks under the Treaty 
and the Statute of the European System of Central Banks and of the European Central Bank. Finally, the ECB understands that the entire costs of the guarantees issued by the Slovenian State 
will be exclusively financed from budgetary resour ces and that they will in no event lead to the 
provision of an overdraft credit facility by Banka Slovenije. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 19 December 2008. 
[signed] 
The President of the ECB 
Jean-Claude TRICHET 
                                                 
9  See e.g. paragraph 3.2 of ECB Opinion CON/2008/52 of 17 Oc tober 2008 at the request of the Spanish State Secretary 
for Economic Affairs on a Royal Decree-L aw creating a Fund for the acquisition of financial assets and on a Royal 
Decree-Law adopting urgent financial and economic measures in  relation to the concerted European action plan of the 
euro area countries; and paragraph 3.7 of ECB Opin ion CON/2008/81 of 1 December 2008 at the request of the 
Hungarian Ministry of Finance on a draft law on strengthening the financial intermediary system. 
10  OJ L 332, 31.12.1993, p. 1. 
11 See Articles 3-6 of the draft Decree.