Banks turned their back on Huta Katowice steel mill

The consortium of banks which extended a zl.400 million loan to Huta Katowice (HK) back in 1998, is now withdrawing from the loan agreement, even though the financial condition of the steel mill is slightly better, claims HK president Miroslaw Wrobel. According to him, HK had a zl.730 million payment deficit in 1998, while now the gap amounts to zl.460 million. However, HK management had been fearing that the consortium of PBK, BPH, Kredyt Bank and Bank Slaski would terminate the loan agreement, as banks are required to create 100% reserves for loans to the steel sector. As a result, HK is in a very bad position now, with state loans and a special credit line being its only hope. The problem is that so far, although a government aid program has been approved, nothing has been done to implement it. If the program is not launched by the end of the year, HK will be forced to shut down one of its two main furnaces, causing some 2,000 people to lose their jobs. The Treasury is planning to sell off HK along with three other steel mills within two years. (Puls Biznesu, p.5) M.K.