The European Central Bank will carry out a comprehensive assessment of five Croatian banks as part of the country's bid to enter the Exchange Rate Mechanism II and, subsequently, the eurozone.

The assessment will include UniCredit SpA unit Zagrebacka Banka d.d., Intesa Sanpaolo SpA unit Privredna banka Zagreb d.d., Erste Group Bank AG unit Erste&Steiermärkische Bank d.d., OTP Bank Nyrt. unit OTP banka Hrvatska d.d., and Hrvatska poštanska banka d.d.

The exercise will comprise an asset quality review and a stress test, both of which will be based on methods that the ECB's banking supervision unit applies in its regular assessments of banks recently classified as significant or that may become significant. The assessment is expected to start in September and will be finalized in May 2020. The lenders will be assessed based on data as of June 30, 2019.

The ECB also said it plans to assess relevant Croatian legislation to ensure the Croatian central bank will be obliged to adopt all measures requested by the ECB in relation to Croatian lenders.