Final Word from Wednesday, March 5, 2003
It's one thing for commentators to bash troubled Czech banks but quite another for public officials to do so. It's no secret in Prague, for example, that anonymous comments from a top finance-ministry official sparked the run on IPB in June 2000. Late last month Finance Minister Bohuslav Sobotka went on the record about Union banka, saying he couldn't be sure that any state aid wouldn't be going down a black hole. Pavel Racocha of the central bank told the BBC that the chances of resolving UB's problems are small because the management and owners will have trouble coming up with a credible plan. Such comments essentially eliminate any chance that UB can reopen. After Rolf Breuer of Deutsche Bank indicated that Kirch media of Germany wasn't creditworthy, Kirch won a court judgment against him. The CR isn't Germany, of course, but UB/Invesmart might also have grounds for recourse if UB never reopens.