CONDITIONS FOR APPROVAL OF
LOMBARD LOANS BASED ON PLEDGE OF FINANCIAL INSTRUMENTS BY
PRIMORSKA BANKA d.d
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
Type of loan
Short-term loans in HRK, EUR and USD for based on pledge of
financial instruments .Loans in EUR and USD are paid and repaid
in HRK according to the CNB middle exchange rate valid on the
use date of the loan i.e. the loan return date.
Loan purpose
Lombard loan based on pledge of financial instruments is a
nonpurpose loan.
Borrowers
Individuals, residents and non-residents as well as legal entities
established in the Republic of Croatia which will, or a third party
will for them, store financial instruments in the Borrower’s
dedicated custody account opened in the Bank and pledge them
in favour of the Bank as a condition for the loan approval and as
a mean of loan insurance.
Loan amount
The minimum loan amount is 20.000,00 HRK/ 3.000,00 EUR/
3.000,00 USD.
The loan amount depends on the financial instrument value and
the defined rate of credit options of the financial instrument
which the Borrower or pledger gives the Bank as a mean of loan
insurance.
The value of financial instruments is determined by the final
price achieved for a particular financial instrument on the
regulated market or the net value of shares in open-end
investment fund, on the day preceding the date of loan approval.
If on that day there was no trading in financial instrument, the
last achieved price on any day before is taken as a reference.
The defined rate of credit options of the financial instrument is
determined by the Banks decision for loan approval
Repayment period
From 6 to 36 months
Repayment method


In equal monthly annuity; or
One-time payment of the principal with monthly interest
payment.
Equal monthly annuity
The first annuity is due on the first day of the following month of
the month in which the loan is put in repayment. The due of
every other annuity is on the first of every month starting from
the maturity of the first annuity.
At the approval of the Agreement for Lombard loan based on
pledge of financial instruments (hereinafter: Agreement) the
Bank will give the Borrower a payment plan.
One-time payment
The loan (principal) is due on the date of the agreed period for
repayment of loans, which is calculated from the day the loan
repayment. From the day the loan repayments until maturity of
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
the loan on the used loan amount is calculated and paid the
agreed interest, maturing in monthly payments, the first of
each calendar month.
The Borrower may ,before the loan repayment period, request
an extension of the repayment period, that is request a renewal
of the Lombard loan. The request must be placed, in written
form, at least 3 days prior to the loan expiration. If the borrower
does not request an extension of the repayment period, that is
request a renewal of the Lombard loan in a way described above
,the Bank is authorized to ,on the loan expiry date, to sell the
pledged financial instruments in order to settle all of its claim
from the Agreement and all other agreements concluded under
this Loan.
Interest


8,25 % for HRK;
7,75 % for EUR i USD.
Pursuant to the laws, the Bank shall calculate and charge penalty
interest at the rate of statutory penalty interest for the period of
delay.
Approval fee

0,75%, charged from the approved loan.
Effective interest rate

10,08% (effective interest rate is calculated for a
loan of 100,000.00 Kuna’s, repayment period of 12
months, equal monthly payments, interest rate 8,25
%, approval fee 0,75%);
Creditworthiness
Collateral
Creditworthiness of the Borrower is not determined.
 Financial instruments stored on a client's custody
account at the Bank with the authorization of the
owner of financial instruments (power of attorney)
with which he authorizes the Bank to sell financial
instruments or keep them for itself in order to settle
any part of the claim at maturity at any time and
without any further consent or approval, on the
basis of its free discretionary decision,
 Borrower’s power of attorney, certified by the
notary and irrevocable, which authorizes the Bank
to, at its sole discretion and without specific notice,
sell financial instruments in custody and use the
received money and funds in the account to settle all
its claims arising from the Agreement after which the
eventual executed surplus will be immediately
transferred to the Borrower’s transaction account at
the Bank,
 1 (one) ordinary promissory note of the Borrower,
certified by a public notary
The Bank will issue a Decision on the conditions of acceptance
of financial instruments as collateral for Lombard loans based
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
on the pledge of financial instruments which will, for each type
of financial instrument, define the maximum rate of credit
options. In accordance with applicable internal procedures, the
Bank shall, for each request for approval of the loan, issue a
special Decision on the rate of credit opportunities for the
offered financial instrument, taking into account the
specificities of a particular financial instrument (listing on the
market, liquidity, marketability, free float, etc.). The Bank has
the right to refuse to take as collateral the offered financial
instrument. The term "financial instruments" implies to all
those that are defined as such by the applicable positive law.
In order to ensure payment of the monetary claim under the
concluded Agreement, the Borrower is required to enter into a
Contract for the provision of custody services with the Bank.
Financial instruments and/or funds offered as collateral to
ensure the repayment of loan and funds from the approved loan,
will be stored in the Borrower’s dedicated custody account
opened in the Bank. By signing the special power of attorney, the
Borrower authorizes the Bank to sell or keep the financial
instruments, at any time, without any further consent or
approval, based on its free discretion, in order to settle any part
of the claim at maturity. After the claim settlement in full, the
eventual executed surplus will be immediately transferred to the
Borrower’s transaction account at the Bank. The Borrower
expressly waives the right to object or the right to in any way
oppose, withdraw or deny the subject sale or retention on any
ground.
Borrower and / or pledger shall obligate, that while on the
pledged financial instruments a lien is enrolled in favor of the
Bank, pledged financial instruments, not to sell or alienate them
in any other way, and that they will not pledge or burden them
in favor of any other creditor.
Upon the settlement of all claims under the Agreement, the Bank
shall exempt the Borrower’s and / or the pledger’s financial
instruments of the lien in a way that it will exempt them from the
Borrower’s designated custody account with the Bank.
All expenses of the extrajudicial settlement will be borne by the
Borrower.
Collateral management methods
During the term of the loan the Borrower is unable to dispose of
collateral. Borrower may dispose of collaterals by the final
repayment of the loan, provided that the settlement of all the
claims that the Bank has to the Borrower
Money management methods
Loan, reduced by the amount of the approval fee, is used in onetime transfer of funds to the Borrower’s transaction account
with the Bank. If it is a credit in EUR or USD, it is paid at the CNB's
middle rate.
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
The loan can be used on the day of the cumulative fulfilment of
the following conditions:
•
Conclusion of the Agreement for Lombard loan based on
pledge of financial instruments
•
Delivery of Power of Attorney (Margin call statement)
certified by Public Notary,
•
Conclusion of the Contract for the provision of custodial
bank services with the Bank,
•
Conclusion of the Multi-Currency Account Contract with
the Bank,
•
Transfer of financial instruments/funds taken by the
Bank as a collateral for the repayment of the loan into Borrower's
dedicated custody account with the Bank,
•
Delivery of all loan collaterals under these Conditions.
Margin call
The Bank will calculate on a daily basis the rate of credit options
of the financial instruments given as collateral and the deviation
from the conditions defined by the Decision on the approval of
the loan.
When the daily rate of credit options of the financial instruments
given as collateral to the Bank falls below 95% of the outstanding
claims under the Agreement due to the decreased value of
financial instruments, the Bank will call upon the Borrower to
fulfill the obligations of a margin call.
Margin call is a call initiated by the Bank to the Borrower to settle
the negative difference within 24 hours of sending the e-mail,
caused by the decrease of the market value of the collateral in
relation to the outstanding loan amount.
Bank makes the Margin call to the Borrower by telephone and,
immediately after the phone call, in writing via e-mail to the email address stated by the Borrower in the Loan application
form. The call is considered valid and made when the notice is
sent via e-mail, given that one of the conditions for approval of
margin loan is the use of electronic mail.
Bank makes the Margin call to the Borrower by telephone and,
immediately after the phone call, in writing via e-mail to the email address stated by the Borrower in the Loan application
form. The call is considered valid and made when the notice is
sent via e-mail, given that one of the conditions for approval of
margin loan is the use of electronic mail.
If the Borrower fails to comply with the Bank’s invitation until the
expiry of the margin call, the Bank may terminate the Loan
Agreement, at its discretion and without special notice, and sell
any financial instrument at the market conditions for the
settlement of all its overdue receivables.
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
If the sale of all available financial instruments does not settle
the Bank’s receivables under the Agreement, the Bank shall act
in accordance with the applicable Primorska banka d.d.
Procedures for debt collection.
Early loan repayment
The Borrower can repay the loan in full or in part before the
agreed deadline, but must inform the Bank no later than eight
(8) days before the day of loan repayment.
In this case, if the Borrower is a legal entity, he is required to pay
the Bank a fee for early repayment of the loan in the amount
determined by the Primorska Banka d.d. Service fees valid on the
date of the early repayment.
Borrowers who already have other loans approved in the Bank,
and who want their outstanding and overdue liabilities to settle
from the loan granted under these Terms, do not pay a early
repayment fee.
Loan cancellation
In case of early loan repayment the Bank calculates and charges
a fee for early repayment of the loan in the amount determined
by the Primorska Banka d.d. Service fees, General Terms and
Condition of Primorska Banka d.d. Rijeka for retail clients and
General Terms and Condition of Primorska Banka d.d. Rijeka for
loans to corporate clients.
The Bank has the right to make overdue all her claims from the
Borrower prior to the expiry of the agreed period in the following
cases:
 if the Borrower presents to the Bank the incorrect
and false documentation,
 if the Borrower does not fulfill any other obligation
assumed under the loan agreement in agreed terms,
 if the Borrower does not fulfill any financial
obligation undertaken under the loan agreement at
its maturity.
In these cases, it shall be deemed that the Borrower’s delay
occurred at his own fault.
With the cancellation of the Agreement by the Bank the loan
amount, accrued interests as well as all other Bank’s claims
arising from loan agreements are due before the expiry of the
agreed period.
In case of the Agreement cancellation, the Bank shall send a
written notice to the Borrower that, due to failure or breach of
contractual obligations, he is in default of contractual
obligations, with the specification of the total due claim and a
request for payment of the Bank’s due claim within a period of
eight (8) days. The Cancellation notice the Bank sends to the
Borrower in writing by a registered mail with return receipt, to
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
the Borrower’s address from the Agreement or to the address of
which the Bank was timely notified in writing. It shall be deemed
that the deadline for payment commences on the date of the
submission of the written notice to the post office, regardless of
the fact whether it was delivered to the Borrower.
Documentation

Lombard loan based on pledge of financial
instruments application form;
For individuals:
1. identity card/passport copy;
2. copy of the valid transaction account card in the name of the
loan applicant;
3. copy of the OIB certificate (personal identification number);
4. personal data statement;
5. list of related parties.
For legal entities:
1. copy of the extract from the Court register;
2. copy of the notice of business entity classification according
to the NKD;
3. copy of the certificate on the issued OIB;
4. copy of the signature card of the persons authorized to
manage the funds in transaction account;
5. statement on the legal entity’s beneficial owner with the list
of Management board members;
6. copy of a valid identity card/passport of the authorized
person/persons
7. personal data statement;
8. list of related parties.
While processing the loan application, the Bank may request
additional documentation that the Borrower is obliged to
present.
Other requirements
The Borrower can request for substitution of his pledged
financial instruments with other acceptable financial
instruments provided that the rate of credit options of the
financial instruments is at least equal to the amount of the
outstanding claims from the Agreement.
The Borrower can request for exemption of his pledged financial
instruments provided that the rate of credit options of the
pledged financial instruments rises above 110% of the amount of
the outstanding claims from the Agreement but not more than
the difference between the credit rate of financial instruments
and the amount of outstanding claims under the Agreement.
Replacement or delivery of financial instruments provided as
collateral to the Bank the Borrower may submit no more than
once every six months.
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
In case of an extension of the repayment period, that is request
of a renewal of the Lombard loan the total value of the pledged
financial instruments may not be less than 95 % of the value of
financial instruments determined at the time of loan approval.
Notary fees and other expenses
In addition to these loan conditions, other credit conditions
prescribed by the Bank’s acts on financing the citizens will be
applied, provided they are not in opposition to the present loan
conditions for the approval of this type of loan.
All expenses related to the approval, insurance, use and
repayment of the loan are born by the Borrower. In addition to
these fees and expenses, the Borrower bears the brokerage and
custodial fees and expenses for transactions with financial
instruments.
The Borrower agrees to pay all fees for public notary, as well as
the expenses in case of delayed payments.
Data protection
Application of these conditions
The Bank is particularly required to keep confidential the
information, facts and circumstances received on the basis of
service provided to the Borrowers and while providing service to
the single Borrower, except to persons and authorities as
prescribed by the law.
By signing the Agreement, participants in legal transactions
concluded under these Conditions whose personal data are
stated in each Agreement and loan documentation, including
MBG and OIB, authorize the Bank to manage the stated
information solely for its own purposes. This includes all personal
information with MBG number, which data are presented to the
Bank via submitted documentation in accordance with
applicable regulations. The information can be collected,
processed and used:
a) for execution of concluded legal work for the provision of
banking and other financial services and in this regard submit
them to a public notary, court, public records etc. and
b) in accordance with applicable regulations, submit them to
other banks and associations for the protection of creditors and
third authorized persons as well as persons with whom the Bank
has agreed business cooperation.
These Conditions apply together with the General Terms of
Primorska Banka d.d. for business relationships with customers,
General Conditions for credit operations with legal entities that
are in force, as well as other Bank’s acts. The specified General
Conditions apply to anything that is not governed by these
Conditions.
These Conditions are published on the Bank’s official website
www.primorska.hr.
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.
These Conditions enter into force and apply from the date of
their adoption.
Changes:
Name of document
No.
version
In
application
Conditions for approval of lombard loans based on pledge of financial
instruments by Primorska banka d.d.
Version
1.0
26.06.2013.
Conditions for approval of lombard loans based on pledge of financial
instruments by Primorska banka d.d.
Version
2.0
06.02.2014.
Conditions for approval of lombard loans based on pledge of financial
instruments by Primorska banka d.d.
Version
3.0
01.01.2015.
Conditions for approval of Lombard loans based on pledge of financial instruments by Primorska banka d.d-ver.2.0.