Prva Banka successfully issued - sold an issue of subordinated bonds worth three million euros on the Montenegrin capital market, which it needed as a supplementary capital instrument.
According to information from "Vijesti", the entire show was sold on the first day of broadcast, December 31st, to a buyer hidden behind a bank custody account.
The bonds, as stated in the prospectus, are due to the bank in seven years, and the buyer receives an annual interest of seven percent as a return - his income, which will be paid twice a year. In other words, in this way Prva Banka has borrowed three million euros, and the buyer will receive the principal in seven years, along with about 1,4 million euros in interest. The Bank's largest shareholder is Aco Djukanovic.
Subordinated bonds are debt securities issued by banks and other financial institutions, and serve as additional capital to strengthen their capital adequacy. They are subordinated to regular bonds, meaning that in the event of a bank's liquidation or bankruptcy, the buyer is paid after ordinary creditors but before shareholders, representing a riskier form of investment for buyers. Due to this increased interest risk, the yield on subordinated bonds is higher than on other bonds.
For comparison, in November last year, the State issued its bonds worth 50 million euros with a maturity of two years and a fixed interest rate of 3,75 percent per annum. In other words, the subordinated bonds of Prva Banka have almost twice the yield - profit for the buyer. Prva Banka participated in the purchase of these government bonds with 20 million euros.
The Capital Market Commission should formally approve the successfully completed bond issue, after which it will be registered with the Central Clearing and Depository Company, which is a condition for enabling their trading on the Montenegro Stock Exchange.
"The issuer intends, upon completion of the issue and registration of the bonds in the Central Securities Registry of the Central Clearing and Depository Company (CKDD), to submit a request to the Montenegro Stock Exchange for the inclusion of the bonds in trading on an organized market, in accordance with the regulations governing the operation of regulated markets and the rules of the Montenegro Stock Exchange. After approval of the request, the bonds will be traded on the Montenegro Stock Exchange market, in the market segment determined by the Montenegro Stock Exchange in accordance with its rules and internal acts. Until the moment of inclusion in trading, the bonds will be registered in the system of the Central Clearing and Depository Company and remain freely transferable between investors in accordance with the law," the issue prospectus states.
The prospectus also reminds of the risk of subordinated bonds, as the bank can pay the debt based on them with the consent of the Central Bank, provided that this does not jeopardize its capital and operations, and that in the event of problems in the bank, the principal debt can be partially or fully written off or converted into bank shares.
"The above measures may be applied without the consent of the bondholder, and their application may lead to partial or complete loss of invested funds," the prospectus of the issued bonds states.
The purpose of the bond issue, as stated, is to improve the bank's capital structure through an increase in regulatory capital with the aim of strengthening the bank's ability to absorb potential losses, to preserve the stability of capital indicators in the medium and long term, and to provide additional space for the continuation of regular operations and growth in the volume of activities.
"In the context of the Bank's financial performance, it should be noted that in the previous period the Bank reported variable operating results, including negative net results in certain years, while data from periodic (quarterly) reports for the period ending on 30 September 2025 indicate the achievement of a positive net result, as well as the growth of key balance sheet positions, including total assets, loan portfolio and deposit base. These indicators indicate a trend of stabilization and recovery of operations, but at the same time confirm the importance of maintaining an adequate level of regulatory capital in the conditions of a changing economic and regulatory environment," the prospectus states.
They indicate that the aim of the issue is to support the Bank's "capital position, business stability and compliance with regulatory requirements regarding capital adequacy."
"The funds raised from this issue are intended exclusively for recognition in the Issuer's regulatory capital as a supplementary capital instrument, since the bonds meet all the criteria prescribed by the decision on the capital adequacy of credit institutions," the prospectus states.
Bonus video:
