Bulgarian bank under assault in smear campaign issues assurances

Bulgaria’s First Bulgarian Bank (FIBank) issued reassurances on June 27 that it had sufficient liquidity, both in cash and financial instruments, to withstand “the unprecedented criminal organised campaign of rumours and public statements” against the lender.

The bank’s statement came after similar assurances were offered by the central Bulgarian National Bank, which described the “outbreak of rumours and malicious public statements” as “criminal actions directly aimed against the savings of every Bulgarian citizen and against the financial stability as a key element of the national security of the country.”

“The Bulgarian National Bank explicitly states that it will use all its means and resources to guarantee peoples’ savings. We address the Parliament, the Government and the President of the country to support our actions in protecting the financial and banking stability for the good of Bulgaria and its citizens,” the central bank said.

Prime Minister Plamen Oresharski, speaking to Bulgarian media in Brussels where he is attending a meeting of the European Council, said that the government will support the central bank’s efforts to “prevent any shaking of people’s confidence” in any lending institution.

Earlier, Interior Minister Tsvetlin Yovchev said that the State Agency for National Security and the Interior Ministry were investigating a campaign against two banks, which he did not name, after text messages and e-mails were sent in recent days to the media and other opinion leaders alleging that the banks were unstable and advising people to withdraw their deposits from them.

FIBank was the target of rumours alleging it was short on liquidity and facing bankruptcy in May 2008, suffering a brief-lived bank run, which was swiftly reversed.

The lender said in a statement that it would cease operations with customers at 3pm on June 27 and resume normal operations on June 30. The bank also said that it had paid out 800 million leva (about 409 million euro) to depositors on June 27.

Earlier this year, FIBank finalised its merger with MKB Unionbank, acquired from Hungary’s MKB Bank, itself a subsidiary of German Bayerische Landesbank (BayernLB). The deal put FIBank’s assets past the 8.9 billion leva (about 4.55 billion euro) mark.

(Photo: fibank.bg)



The Sofia Globe staff

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