Former Minister of Finance and President of the "Europe Now" movement Milojko Spajic claims that the entire debt procedure from December 2020 through the issue of government bonds of 750 million euros on the international market was legal.
In his statement to "Vijesta", he accused the Minister of Finance Alessandar Damjanović that he is trying to hide that he is in debt to the state at extremely high interest rates, and because of that he is drawing attention, as he claims, to false accusations that have been going on for three years, and which, he said, have been checked by all institutions in Montenegro, Great Britain and the United States The United States, including the Special State Prosecutor's Office.
Yesterday, the government decided to forward to the prosecutor's office information regarding the issue of bonds from 2020 at the suggestion of Damjanović in order to examine the entire process of legality and the possibility of abuse and illegal enrichment of third parties by using public finances to obtain illegal profits.
"Vijesti" asked the SDT whether they have taken any actions in connection with the issue of bonds so far, and whether they have received any criminal charges related to this issue, who the applicant is and what has been done about it. applications.
Damjanović said at the Government session that in December 2020, Spajić made a decision that was fictitiously implemented through the state treasury, which included the amount of 3,51 million euros related to the costs related to the issuance of state bonds from that year and which was allegedly transferred to the accounting account of the CBCG. He announced that the Ministry of Finance asked the CBCG for a confirmation of the money transfer and that the supreme monetary institution informed him in an official letter on February 8 of this year that the money from the state treasury never reached its account.
Spajić: It is a discount, it is not paid for
When asked by "Vijesti" about whether the amount of 3,5 million was paid to the CBCG account, and whether he thinks there is work for the prosecution in connection with this procedure, Spajić said that the CBCG confirmed that there was no discount payment , because it is not paid, but deducted from the issue amount, so that the interest rate is lower.
"Discount is the amount we pay when taking out a loan so that the interest rate is lower. For example: you took a loan of 100 with an interest rate of six percent. To reduce the interest to five percent, instead of 100 thousand, you withdraw 97 thousand. So, the bank left three thousand for itself, you return 100 thousand, but you got a lower interest that you pay in the future every month", said Spajić.
Specifically, in the case of the bond, he gave the following explanation.
"We asked investors on the stock market for 750 million euros. We received an interest (yield) of 2,95 percent. In order to reduce it to 2,875 percent, we agreed to pay a discount of 3,51 million euros. The investors deducted that money from the amount we asked for. So, we did not get 750 million euros, but 745 million, 3,51 million for the discount and 1,46 for the costs of the transaction, that is, lawyers, investment bankers and fiscal agent, without the possibility of any bribery and abuse. The CBCG, as announced by the outgoing minister, confirmed that there was no discount payment, because as we stated: the discount is not paid but deducted from the amount of the issue," said Spajić.
He added that the discount is a market standard, and that the procedure is exactly the same as for the Montenegrin bond from 2019 or any other bond going to the London Stock Exchange.
The discount in 2019 was 10,7 million
Spajić noted that in 2019, during the emission of 500 million bonds, the Government Duško Marković had a discount of 10,77 million euros.
"It is interesting that Damjanovic and Nebojsa Medojevic they never mention that fact - it's clear who they're messing with," he said.
The former minister also stated that the Bloomberg platform clearly shows that the bond was issued at an interest rate of 2,875 percent.
"Which was below the yield (2,95%) in order to follow the standards of the London Stock Exchange, where interest on bonds must be issued in increments of one eighth, that is, in our case, two percent and seven eighths (2,875 percent), and therefore the difference between 100 percent and 99,532 percent on the nominal amount of debt is 3,51 million, which the investors did not even pay. (100-99.532=0.468%x 750= 3,51)", Spajić said.
According to him, it is a process involving two of the most renowned international law firms ("White and Case", "Linklaters"), which gave a positive opinion, as well as local law firms. In this case, he added, at the initiative of the NGO sector, the complete documentation was made public, including the mandate letter, legal contracts...
"The debt was legally based on the rebalance from June 2020 and the accompanying Decision on borrowing for the same year. At the session held on December 07, 12, the government adopted conclusions no. 2020-07, based on information on the starting points for the realization of the bond issue that will be issued/issued on the international market in 208 or 2020. With the aforementioned conclusions, the Government has authorized the Ministry of Finance and Social Welfare to issue bonds on the international market," said Spajić.
Distracting from expensive debt?
He also said that Damjanović is "trying to hide terribly expensive debts with false accusations", as well as that they do not understand the terminology, "let alone the method of implementing bond issues, which are the most transparent and cheapest way of lending".
"We will try to explain to him the alphabet of bonds, so that he can stop harmful bilateral loans in time: one such loan has already been signed at an interest rate three times higher than ours - 7,5%, and the next short-term loan may be even more expensive, which will put him in a financial noose around the neck of Montenegro. In order to hide that he is in debt to the state at extremely high interest rates, the technical minister is trying to divert attention with false accusations that have been going on for three years, and which have been checked by all the institutions of Montenegro, the UK and the USA (including our SDT)," concluded Spajić.
Damjanović said earlier at the Government session that Spajić issued a decision on December 23, 2020, which was fictitiously brought through the state treasury with an order to make the following entries: to record in the treasury system on December 16, 12, the inflow based on issue of 2020 million (funds attributable to the issue), to record an outflow of 4,93 million (discount amount for the bond issue), an outflow of 3,5 million (bank fee) and an outflow of 1,35 thousand (expenses related to contracting).
And Abazović supported that everything be investigated
Damjanović added that in the decision they write that these costs are a discount for issuing bonds, bank fees and costs related to contracting and that they are recorded in favor of the CBCG accounting account.
He said that the explanation of that decision does not contain a call to the Government's conclusion approving these transactions, while the said inflows and outflows occurred on December 16, 2020, they state as a result of indebtedness on the international market based on Eurobonds in the amount of 750 million.
"Therefore, funds of 3,5 million were suspended at foreign banks with the possibility of transferring them to legal and natural persons, as well as the possibility of bribery and other abuses. After all the activities carried out, the Law on the final account of the budget shows the transfer of EUR 750 million based on the issue of bonds, while the inflow of funds based on the issue to the account of the state market was recorded on December 16, 12, in the total amount of EUR 2020 million. Damjanovic said.
He said that, accordingly, they demand that the entire process of the legality of issuing bonds be reviewed with the monitoring of the flow of money.
Prime Minister Dritan Abazovic at the Government session, he called on the competent authorities to determine what happened.
Twitter correspondence, "secret advisors" and "revival of the alphabet"
President of the Social Democratic Party (SDP) Rasko Konjević he said that they would now know who the "secret advisers" were and where the 3,75 million euros had "disappeared" if the members of the government had supported their proposal two years ago to open a parliamentary investigation and form an Inquiry Committee to collect information on the actions of state authorities based on issuance of bonds of 750 million.
Spajić then announced a lawsuit on Twitter due to, as he said, untruths about the fictitious transfer of 3,5 million euros to the CBCG account.
"The United Democratic Party of Socialists (DPS) from the 90s repeats a false pre-election story that was verified by all Montenegrin, British and American institutions responsible for issuing bonds," Spajić wrote.
He said that it is obvious that in 1993, the term "discount" was not in the textbooks, "when the hyperinflationary students are so embarrassed by their ignorance".
Spajić also announced a press conference on this matter for today, and said that at it he would "renew the alphabet of finance" and present the aforementioned lawsuit.
Konjević then replied to Spajić that he should leave the "alphabet and knowledge" for the prosecution and that he would probably need us.
Leader of the Movement for Change Nebojsa Medojevic, who even earlier claimed that 745 million instead of 750 million came in during the borrowing, announced that the Government had carried out the proof work and that this was "an easy job for Vladimir Novović (Chief Special Prosecutor)".
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