ECONOMY

Romanian gov’t delays sale of BCR to Austria’s Erste

BUCHAREST (Reuters) – Romania’s government yesterday put back by a month a deadline to close the sale of leading bank BCR to Austria’s Erste Bank, after the deal stalled on an inconclusive court vote. Earlier yesterday the Constitutional Court was unable to decide on the sale, one of the last major bank privatizations in Eastern Europe. «The government decided to extend the deadline to finalize the privatisation of BCR to October 20,» government spokeswoman Oana Marinescu said in a statement. «The (remaining) condition to close the deal is. .. the publication of (a privatization) law in the official gazette. This condition will take longer. The centrist government had initially pledged to seal the sale by September 21 but last week some opposition senators challenged the deal, saying it was too costly for the poor Black Sea state of 22 million people. «The Court concluded that it cannot make a legal decision with the votes equally divided four to four,» the court said in a statement. The approval of a majority of the eight members of the constitutional court was required – the ninth position has been vacant since April 2006. «This decision means the sale cannot be legally completed tomorrow,» said Mircea Cosea, a deputy from the Liberal party. Parliament cleared the sale of 62 percent of BCR to Erste for 3.75 billion euros ($4.8 billion) last week. Erste said yesterday it wanted to finalize its biggest purchase ever as soon as possible. «With all other conditions being fulfilled, completion is anticipated to go ahead at the earliest possible date following the expected favourable decision of the Constitutional Court and subsequent promulgation and publication of the privatization law,» the bank said in a statement. A drawn vote yesterday means the court will have to take a new vote on the BCR sale but when that might happen was not immediately clear. «There is currently no legal action taken in the lower chamber to appoint the ninth judge,» said Cristian Ionescu, head of the legal department in the lower house of parliament. «If there is political will, it would take one, two weeks to name a new Constitutional Court judge,» he told Reuters.