Bulgarian banks prepare to begin payouts of CCB deposits

Written by on December 3, 2014 in Business - Comments Off on Bulgarian banks prepare to begin payouts of CCB deposits

On the eve of the first day that nine banks will begin payouts of claims on deposits in the Corporate Commercial Bank (CCB), officials in Bulgaria said that preparations were in place to make the process as smooth as possible.

Earlier this week, Finance Minister Vladislav Goranov said that the police and State Agency for National Security (SANS) employees would enforce public order outside the branches of banks picked to pay out depositor claims.

On December 3, Interior Minister Vesselin Vuchkov said that while police officers would provide security for as long as needed, the ministry would not go out of its way to guard bank offices. “There will be no mobilisation of police officers because there are branches of those banks throughout the country, about 1150 in total. I hope that there will be no tension and I am counting on the good sense of Bulgarian citizens,” he said after the weekly Cabinet meeting.

Vuchkov said that it was not the duty of police officers to guard depositors who chose to withdraw their money in cash and said that such activities were the job of private security firms.

Petar Andronov, chief executive of CIBank, one of the lenders picked to handle payouts, advised depositors not to rush out on the first day to hand in their claim. He said that banks had to make sure that they had the right person making the claim and that identity checks could slow down the process.

He said that it was best if depositors avoided the initial rush to prevent formation of long queues. Bank employees would also attempt to manage the situation by advising customers to visit branches facing smaller numbers of claimants, Andronov said.

Andronov’s comments came at a banking seminar in Sofia on December 3, organised by the Bank of the Year Association, which chose not to award its annual prizes this year. CCB won a third award for dynamic growth from the association at last year’s gala.

Some analysts have also advised other regular bank customers to avoid visiting the bank in the first few days of CCB deposit payouts, suggesting that the nine banks picked by the state deposit guarantee fund will have their hands full handling depositor claims.

The nine banks were announced on November 24, with the state guarantee fund also posting answers to frequently-asked questions on its website (in English).

In related news, the Cabinet decided on December 3 that all the money held by state institutions and local administrations at CCB would be paid out by the Finance Ministry by February 1 2015. In exchange, their claims will be transferred to the ministry, which will hope to recover the money further down the line should the bank be declared insolvent.

(For full coverage of the CCB situation from The Sofia Globe, click here. Logo and corporate motto of Corporate Commercial Bank – “our clients are dear to us” – from a CCB advert. Screengrab from corpbank.bg)

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