At any moment, a minority shareholder could request the listing of BCR

Reporter: Is the agreement to postpone the listing of BCR legal or not? Did the SIFs need a power of attorney to conclude an agreement concerning the postponing of this listing?

Cristian Duţescu: I think that the issue here is whether the obligations to report and to inform shareholders have been fully honored. I can"t say whether it is legal or not, because I haven"t seen the contract. We don"t know what commitments the SIFS have made through that agreement, we just know that it was used to postpone the listing of BCR.

I think it would have been fair for the shareholders of the SIF to lobby for the terms of the agreement to be made public. After all it is a legal document concluded based on the privatization agreement, a contract which is public...

Reporter: Is the supermajority clause currently in effect? Or will it come into effect if Erste doesn"t fulfill the obligations undertaken through the contract?

Cristian Duţescu: The supermajority clause was not only intended to benefit the SIFs, but the other minority shareholders of BCR as well. They could come to the conclusion that they have been prejudiced by the agreement to postpone the listing of 2009.

The supermajority clause may not come into effect due to the agreement to postpone the listing. According to art. 13.2 letter g) of the privatization contract, Erste was required to summon an extraordinary general shareholder meeting in which it would vote on reactivating art. 16 of the statute of BCR concerning the supermajority clause for important decisions, such as merger, liquidation, share capital increase, reorganization, etc. At any rate, the clause would have been useless anyway, considering that, at the last General Shareholder Meeting of BCR, only one of the SIFs voted against the share capital increase of BCR.

Reporter: Does the privatization contract of BCR stipulate any sanction for the failure to honor the contractual obligations assumed by Erste? Such as the refusal to list BCR?

Cristian Duţescu: No, it doesn"t stipulate any sanction, aside from the reactivation of the supermajority clause. There are however civil law sanctions available...

Reporter: Does this mean that even a shareholder owning one share of BCR could sue the bank?

Cristian Duţescu: Yes, on the grounds that they want to sell their share, but they have no market to do it in. The shareholder in question could sue the bank and ask for the price that a share could have had today, had the bank been listed. Any shareholder can request the honoring of the obligation to list the bank on the stock market, given that it is stipulated in a contract. According to the privatization contract, Erste makes the commitment of taking certain steps to take BCR public. Failure to honor these commitments represents a violation of the contractual clause in question.

Reporter: What is your opinion on the fact that the contract for the privatization of BCR provides no sanctions for the event it is not abided by?

Cristian Duţescu: The Romanian state, through the AVAS, has declined any liability for this, according to art. 13.2 letter i... in case the agreement isn"t honored...

Reporter: Then who would be liable?

Cristian Duţescu: It needs to be seen who the lawyers of the state were in the privatization of BCR, who signed the privatization contract ... etc. I don"t know how the talks went down at the time, they probably talked to the SIFs as well and that is why a clause was introduced in the contract to protect them (ed. note: the supermajority clause). The price from the privatization of BCR was indubitably very good, perhaps that is why the privatization contract stipulates no sanctions...

Reporter: However, the SIFs decided not to use this clause when they signed the agreement to postpone the listing ...

Cristian Duţescu: I am not familiar with the provisions of the agreement to postpone the listing. If this indeed what happened, then the SIFs are indeed to blame. They gave up on the application of the corporate governance principles...

Reporter: Mr. Cuzman, the president of SIF1, yesterday announced that the SIFs have received a concrete offer to sell from "Erste", to liquidize their stakes in BCR ...

Cristian Duţescu: We"re talking about a sale, under no circumstances are we talking about the listing ....

Reporter: Why do you say that?

Cristian Duţescu: Because under no circumstances does "Erste" want the listing...

Reporter: But if the SIFS do want it ....

Cristian Duţescu: But do the SIFs really want the listing? That is the question.

Reporter: Still how could the SIFs sell their stakes in BCR, given the fact that they need the approval of the Extraordinary General Shareholder Meeting to do that, and with the exception of SIF Transilvania, the quorum for the Extraordinary General Shareholder Meeting is impossible to reach ...

Cristian Duţescu: There are various solutions, perhaps a sale with a payment in installments, even though the legal document is only concluded at a specific moment, or evaluating the shares at price which would make the amount of the sale be small enough to fit within the limits of the attributions of the Board of Directors of the SIFs.

Reporter: Why do you think that SIF2 is the only one so far to announce that it intends to summon the General Shareholder Meeting?

Cristian Duţescu: Because they don"t know if the other SIFs are willing to summon the General Shareholder Meeting themselves...

Reporter: The contract stipulates that BCR must be listed. If the SIFs sell their stakes without BCR being listed, would that still be a problem?

Cristian Duţescu: The contract stipulates the listing of BCR within a certain time frame ... if the bank doesn"t get listed, no sanction will occur, but a vulnerability still remains because a minority shareholder can show up at any time and request the honoring of the commitments of the contract ...

It is my impression that only certain SIFs have negotiated with "Erste" to sell their stake in BCR, judging by the information that is public. However, I do not think that the offer of "Erste" was discussed in the Board of Directors of the SIFs, or else it would have been reported on the BSE. It seems however that certain SIFs do not wish to summon the General Shareholder Meeting to initiate the approaches to list BCR for reasons which I fail to understand. I can"t tell what would be so confidential about this. The only explanation is that Erste would get mad if they did. Are the people at the SIFs on the payroll of BCR and we haven"t been told about it?

Reporter: Andreas Treichl, the executive chairman of Erste Group, said on Friday, in Vienna that he would do everything in his power to prevent the bank from being listed...

Cristian Duţescu: Such a statement is extremely serious, and in my opinion it is unacceptable ... how can anyone talk like that about complying with the terms of a contract concluded with the Romanian government?

Reporter: How do you interpret that statement?

Cristian Duţescu: Mr. Treichl gave the SIFs a sign that "Erste" is ready to buy them out... When would anyone say anything like that? When there have been already been talks on that subject ... at any rate, if that is the case, what is important is the exit price.

Reporter: The press release concerning the request to summon General Shareholder Meetings at the SIFs came from law firm Duţescu and Asociaţii, that is, from you. You are representing SIF 2 in their lawsuit against ArcelorMittal. SIF2 has investments in some of the funds that have requested the summoning of General Shareholder Meetings ... Was the request to summon the General Shareholder Meeting at the SIFs decided by you together with SIF2?

Cristian Duţescu: No. It wasn"t a common strategy with SIF2.

Moreover, SIF2 asked for a large number of documents, amid an excessive bureaucracy, in order to allow filing the request to summon the General Shareholder Meeting.