Opinion of the European Central Bank of 27 May 2014 on public access to specific information concerning the bad loans of certain banks (CON/2014/39)
Date: 2014-05-27
Institutions: European Central Bank
Subjects: Slovenia, State aid, access to information, bank, disclosure of information, financial stability, loan, national law

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 27 May 2014 

on public access to specific information concerning the bad loans of certain banks  

(CON/2014/39) 

Introduction and legal basis 

On  11  April  2014,  the  European  Central  Bank  (ECB)  received  a  request  from  the  President  of  the 

Slovenian  Parliament  for  an  opinion  on  a  draft  law  amending  the  Law  on  access  to  public  sector 
information1 (hereinafter the ‘draft law’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union and the sixth indent of Article 2(1) of Council Decision 98/415/EC2, 

as the draft law relates to rules applicable 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 law 

1.1  The Law on access to public sector information3 (hereinafter the ‘Law’) provides a procedure for 

free access to and reuse of information held by entities governed by public law. According to the 
most recent amendments to the Law4, this includes information held by commercial entities under 

the dominant influence of entities governed by public law. 

1.2  As a result of the State aid recently granted to certain Slovenian banks5 in the form of, inter alia, 

recapitalisation  and  the  transfer  of  impaired  bank  assets  to  the  state-owned  Bank  Asset 

Management Company (BAMC), the most recent amendments to the Law require public disclosure 
of specific information on ‘bad loans’6 transferred by the banks that have received State aid to the 

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Predlog zakona o spremembah in dopolnitvah Zakona o dostopu do informacij javnega značaja, dated 8 April 2014. 
Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central Bank by national authorities 
regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).  
Zakon  o  dostopu  do  informacij  javnega  značaja  (ZDIJZ)  (Ur.  l.  RS  No  51/06  –  official  consolidated  text,  117/06  - 
ZDavP-2 and 23/14). 
Adopted  on  24  March  2014  and  entering  into  force  on  17  April  2014  (Zakon  o  spremembah  in  dopolnitvah  Zakona  o 
dostopu do informacij javnega značaja (ZDIJZ-C) (Ur. l. RS No 23/14). 
Pursuant to the Law on Slovenia’s measures to strengthen bank stability (Zakon o ukrepih Republike Slovenije za krepitev 
stabilnosti bank (ZUKSB)) (Ur. l. RS No 105/12, 63/13 - ZS-K and 23/14 - ZDIJZ-C). 
The term ‘bad loans’ is defined in Article 6.a(6) of the Law. 

 
 
 
 
                                                 
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BAMC7. The Law now requires that for each bad loan transferred, the following information is to 

be disclosed by the BAMC:  

(a)  

information  relating  to  concluded  contracts  including:  (i)  the  type  and  value  of  the 

transaction; (ii) the name and registered seat of both the creditor and debtor and; (iii) the date 

of conclusion of the contract;  

(b)  

information  concerning  the  resolutions  adopted  by  the  body  within  the  relevant  bank 

responsible  for  the  approval  of  the  transaction  including:  (i)  the  name  of  the  body  that 

approved the transaction together with the name and position of each member of the body; 

and (ii) the names of the bank’s Management Board and Supervisory Board members at the 

time of approval of the loan;  

(c)  

information on documents concerning the security interest to include the type of the security 

interest and assets which are the subject of the security interest for the loan; and  

(d)  

information concerning the agreement concluded between the relevant bank and the BAMC 

including: (i) the name and registered seat of the bank; (ii) the debtors of the individual bad 

loans  transferred  to  the  BAMC;  and  (iii)  the  final  gross  exposure  to  individual  debtors  of 

such loans.  

This disclosure is to be made on the BAMC’s website8. 

1.3  Building on these most recent amendments, the draft law broadens the scope of disclosure required 

in relation to bad loans. Not only is the information on bad loans transferred from the banks that 

have  received  State  aid  to  the  BAMC  to  be  made  public,  but  also  information  on  bad  loans 
remaining  on  their  balance  sheets  at  the  date  of  entry  into  force  of  the  draft  law9.  The  draft  law 

requires banks that have received State aid to publish on their websites the relevant information on 
bad loans referred to in paragraph 1.2 above10. 

1.4  According  to  the  explanatory  memorandum  to  the  draft  law,  following  the  recapitalisation  of  the 

banks with taxpayers’ money, the public interest requires an increase in transparency as proposed 

by  the  draft  amendments.  The  explanatory  memorandum  states  that  the  extensive  State  support 

granted to the banks calls for transparent, efficient and responsible conduct by both the BAMC and 

the banks in future. 

2. 

Duty to consult the ECB 

The ECB notes that the most recent amendments to the Law, which introduced a requirement for public 

disclosure  of  information  relating  to  bad  loans  transferred  to  the  BAMC,  also  assigned  a  new  task  to 

Banka Slovenije. Pursuant to Article 10.a(10) of the Law, Banka Slovenije is to specify detailed rules for 

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Article 6.a(5) in connection with Article 1.a(3) of the Law. 
See Article 6.a(5) to (7) and Article 10.a(10) of the Law. 
See the proposed amendments to Article 6.a(5) of the Law. 
See the proposed amendments to Article 6.a(7) of the Law, the proposed Article 10.a(13) and the transitional provisions 
of the draft law. 

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the publication of information on bad loans. Based on Articles 127(4) and 282(5) of the Treaty and the 

third indent of Article 2(1) of Council Decision 98/415/EC, the national authorities must consult the ECB 

on draft legislative provisions that fall within the ECB’s fields of competence, including draft legislative 

provisions  that  relate  to  national  central  banks.  The  ECB  must  be  consulted  on  national  legislative 

provisions before they are adopted and at an appropriate stage in the legislative process which gives the 

ECB sufficient time to examine the draft legislative provisions, adopt its opinion and allow the relevant 

national  authorities  to  take  the  ECB’s  opinion  into consideration.  The  ECB  requests  that,  in  future,  the 

Slovenian authorities meet their obligation to consult the ECB. 

3. 

Disclosure of information 

3.1  Pursuant to the Law and the draft law, a broad range of information on the individual bad loans of 

Slovenian  banks  that  have  received  State  aid  pursuant  to  the  Law  on  Slovenia’s  measures  to 

strengthen bank stability is required to be published. Publication is required either by the BAMC, 

where the bad loans are transferred from the banks, or by the banks themselves if they have loans 

recorded as bad loans on their balance sheets at the date of entry into force of the draft law.  

The explanatory memorandum to the draft law could be interpreted as providing that the scope of 

the disclosure obligation under the Law and the draft law covers those banks that have received or 

will receive State aid by the date of entry into force of the draft law. Therefore, the banks would 

have to disclose information concerning the loans on their balance sheet recorded as bad loans on 

the date of entry into force of the draft law. However, this is not clear due to the wording of the 

proposed  amendment  to  Article  6.a(5)  of  the  Law,  in  particular  on  a  reading  of  the  consolidated 

text of Article 6.a(5). 

3.2  The  ECB  notes  that  specific  disclosure  obligations,  exceptions  and  prohibitions  are  imposed  by 
Union  law,  e.g.  the  Capital  Requirements  Regulation  (CRR)11,  the  Capital  Requirements 
Directive12,  the  Market  Abuse  Regulation13,  the  Prospectus  Directive14,  as  well  as  by  Slovenian 
national law, e.g. the Law on banking15. The ECB would welcome clarification in the draft law as 

to the interaction and priority between the specific information disclosure to be made pursuant to 

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Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements 
for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1). 
Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit 
institutions  and  the  prudential  supervision  of  credit  institutions  and  investment  firms,  amending  Directive  2002/87/EC 
and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338). 
Regulation (EU) No .../2014 of the European Parliament and of the Council on market abuse (market abuse regulation) 
and  repealing  Directive  2003/6/EC  of  the  European  Parliament  and  of  the  Council  and  Commission  Directives 
2003/124/EC, 2003/125/EC and 2004/72/EC (not yet published in the Official Journal). 
Directive  2003/71/EC  of  the  European  Parliament  and  of  the  Council  of  4  November  2003  on  the  prospectus  to  be 
published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC (OJ L 345, 
31.12.2003, p. 64). 
Zakon  o  bančništvu  (ZBan-1)  (Ur.  l.  RS  No  99/10  –  official  consolidated  text,  52/11  -  corr.,  9/11  -  ZPlaSS-B,  35/11, 
59/11, 85/11, 48/12, 105/12, 56/13, 63/13 - ZS-K and 96/13). 

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the draft law and the disclosure obligations or prohibitions under Union law and existing national 
legislation (including national legislation transposing Union law)16.  

The ECB further notes that the CRR provides for a  comprehensive disclosure regime  which also 

contains  rules  on  the  disclosure  of  impaired  exposures  and  confidential  information.  The  CRR 

allows  institutions  to  omit  the  disclosure  of  items  of  information  where  the  information  is 

confidential,  i.e.  if  institutions  have  binding  obligations  of  confidentiality  to  customers  or  in 
counterparty relationships17. Confidentiality clauses are usually to be found in loan agreements and 

therefore  constitute  one  such  binding  customer  or  counterparty  relationship.  Moreover,  the  CRR 

contains  a  rule  on  the  disclosure  of  impaired  and  past  due  exposures  which  regulates  the 

information to be disclosed on bad loans in amounts allocated by, for example, geographical area 
(rather than by bank customer or counterparty)18. The rationale behind the relevant Articles of the 
CRR19  is  that  legal  provisions  on  the  disclosure  of  financial  information  must  not  require  credit 

institutions  to  disclose  details  relating  to  customers  or  other  counterparties  to  a  loan  agreement. 

Also, the competent authorities should pay appropriate attention to cases  where they suspect that 

information is regarded as, inter alia, confidential by an institution in order to avoid disclosure of 
such  information20.  Finally,  the  objective  of  the  CRR  to  ensure  progressive  convergence  towards 
uniform rules on disclosure by institutions should not be undermined21. 

3.3  The  explanatory  memorandum  to  the  draft  law  states  that  the  disclosure  of  information  on  bad 

loans  is  in  the  public  interest  due  to  the  State  aid  involved  in  the  rehabilitation  of  the  Slovenian 

banking system and that the draft law aims to foster responsible conduct in the future. In addition to 

the ECB’s observations on the interaction of the draft law with Union financial services legislation 

raised in paragraph 3.2 above, the ECB notes that there may be exceptional circumstances where 

the  information  will  be  of  systemic  importance  and  where  legitimate  interests  will  justify  that 
disclosure  be  delayed  or  prevented.  Such  legitimate  interests  could  include22:  (a)  preserving  the 

stability of the financial system; (b) preventing liquidity crises from turning  into solvency crises; 

(c) avoiding circumstances where public disclosure could undermine the conclusion of negotiations 

designed  to  ensure  the  long-term  financial  recovery  of  a  credit  institution;  and  (d)  ensuring  the 
orderly  application  of  resolution  tools  under  the  Bank  Recovery  and  Resolution  Directive23. 

Therefore,  the  ECB  queries  whether,  from  a  financial  stability  perspective,  the  draft  law  should 

also  provide  some  safeguards  regarding  the  publication  of  information  relating  to  bad  loans 

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See Opinion CON/2011/84, paragraph 7.2. 
See Articles 432 and 442 of the CRR. 
See Article 442(h) of the CRR. 
See Articles 432 and 442 of the CRR. 
See recital 68 of the CRR.  
See recital 120 of the CRR. 
See Opinions CON/2012/99, paragraph 9, CON/2011/84, paragraph 7.2 and CON/2012/21, paragraph 16. 
Directive  2014/…/EU  of  the  European  Parliament  and  of  the  Council  establishing  a  framework  for  the  recovery  and 
resolution  of  credit  institutions  and  investment  firms  and  amending  Council  Directive  82/891/EEC,  and  Directives 
2001/24/EC,  2002/47/EC,  2004/25/EC,  2005/56/EC,  2007/36/EC,  2011/35/EU,  2012/30/EU  and  2013/36/EU,  and 
Regulations  (EU)  No  1093/2010  and  (EU)  No  648/2012,  of  the  European  Parliament  and  of  the  Council  (not  yet 
published in the Official Journal). 

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required  by  Article  6.a(5)  of  the  Law.  Ideally,  the  assessment  of  whether  the  information  is  of 

systemic  importance  and  whether  the  delay  or  prevention  of  disclosure  is  in  the  public  interest 

should be made by Banka Slovenije, as both the national central bank and the national supervisory 
authority, in close cooperation with the relevant macro-prudential authorities and the ECB24. 

This opinion will be published on the ECB’s website. 

Done at Frankfurt am Main, 27 May 2014. 

[Signed] 

The President of the ECB 

Mario DRAGHI 

24  

See Opinion CON/2012/21, paragraph 16.3. 

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