The Government of Slovakia seeks to improve VUB''s performance and secure its future through its sale to an experienced and well capitalized international bank ("Strategic Investor"), thereby indirectly helping the overall development of the financial sector, which must be strengthened to support the country''s continuing transition to a market economy.

The Government of Slovakia and its advisors consider that a pre-privatization investment by a multilateral development bank (MDB) will contribute to a speedier and more successful sale of VUB to a Strategic Investor. An IFC investment in VUB would support the Bank''s efforts to improve transparency and corporate governance.

Support for VUB would be consistent with both IFC''s and the World Bank''s strategy for the Slovak Republic. IFC''s objectives in the Slovak Republic include catalyzing foreign investment that will contribute institutional know-how and strengthen the financial sector. IFC''s assistance in the state''s divestment of VUB to a Strategic Investor also complements the World Bank''s activities in Slovakia. The central operation of the World Bank''s envisaged lending program for Slovakia is an Enterprise and Financial Sector Adjustment Loan which, if approved, would support the Government''s financial sector restructuring and privatization program.