Romania Might Need Other EUR4B For Proprietatea Fund Compensations

05.24.2011 ZF English

The price at which Fondul Proprietatea (FP.RO) shares are traded on the bourse, almost halved from the face value of RON1, is forcing the Romanian government to add another EUR4 billion to compensations to former owners, maintains Viorel Stefan, a PSD (Social Democratic Party) deputy and a member of the Budget-Finance Committee of the Chamber of Deputies.

The Proprietatea fund share price is by far the most-closely watched among the 70 stocks traded on the Bucharest bourse, as how fast the 37% stake in the fund still held by the state is distributed and the collection of compensations by the former owners who received fund shares in exchange for the properties confiscated by the communist regime are depending on it.

"The big problem is that the fund's shares are traded on the bourse at half their face value. The state can meet only half of compensation claims.

The fund is worth EUR4 billion, but for the state to be able to cover all compensation claims, it has to come up with another EUR4 billion," Viorel Stefan said.


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