The Montenegrin government has revoked approval for a proposed €15 million loan between Luštica Development and Belgrade-based Alta Bank, which was to be secured against the developer’s usage rights over a marina and waterfront promenade at Luštica Bay near Tivat.
The government had authorised registration of the pledge on June 29, but reversed the decision during a telephone session on July 28. The Ministry of Spatial Planning, Urbanism and State Property was instructed to remove the security interest from public records. The government did not provide a detailed explanation, stating that new legal and factual circumstances had removed the basis for maintaining the pledge.
Proposed Alta Bank Financing
The planned five-year loan was intended to provide permanent working capital for Luštica Development. The initial fixed interest rate was set at 8.5%, with the rate due to fall to 7.5% after registration of the collateral. The agreement also included a 12-month grace period.
The proposed security covered the company’s usage rights over the marina and waterfront promenade located on a state-owned site in Radovići, Tivat. In the event of non-repayment, Alta Bank could potentially have acquired the right to use the property. The financing now appears either to have been abandoned or to be proceeding without the proposed marina collateral. Luštica Development reportedly said it currently had no loan arrangements with Alta Bank.
Previous Alta Bank Borrowing
Luštica Development’s 2025 financial statements show that the company had previously borrowed €10.65 million from the Serbian lender through three long-term facilities of €4.15 million, €3.5 million and €3 million. The accounts reported total long-term borrowing of approximately €47.72 million, with €26.19 million due within the current period.
The company’s largest lender at the end of 2025 was Crnogorska Komercijalna Banka, to which Luštica Development owed approximately €24.31 million. Its long-term loans carried an average interest rate of 6.23% and were secured by mortgages and promissory notes.
€35 Million AIK Bank Facility
Luštica Development also entered into a separate €35 million investment loan with Serbia’s AIK Bank in December 2025. The company drew the facility in two tranches of €20 million and €15 million in January 2026.
Collateral for the AIK Bank financing included mortgages, rights over construction plots, receivables and shares held by Orascom Development Holding, together with a corporate guarantee from the Swiss-Egyptian group.
Company Liabilities and Ownership
At the end of 2025, Luštica Development had €11.35 million in short-term loans from Montenegrin banks. Business liabilities stood at €47.68 million, while advance payments received from buyers for apartments, leases and parking spaces amounted to €32.51 million. The company reported an after-tax profit of €574,487 for 2025. Luštica Development is majority-owned by Orascom Development, while the Montenegrin government holds just under 10% of the company.
