The Bulgarian National Bank (BNB) announced on July 11 that it would repeal the banking licence of the country’s fourth-largest lender, Corporate Commercial Bank (CCB). Below is a timeline of events that led to the announcement.
Bulgarian media report prosecutors and police search and seize documents at offices of companies in Sofia, claiming the investigations were in connection with allegations against Tsvetan Vassilev, majority shareholder of CCB. Sofia City Prosecutor’s Office does not name the companies where the inspections were carried out, but specifies that they did not include the buildings of banks.
Bulgaria’s central bank issues statement: “On the occasion of publications and media speculation about Corporate Commercial the Bank Bulgarian National Bank says that carefully and closely monitors the development of the banking sector, including the said Bank.”
Bulgarian media report receiving an anonymous letter whose author alleges that BNB deputy governor for bank supervision, Tsvetan Gounev, is under investigation for allegedly faily to exercise proper oversight of a “bank that has become the centre of attention in recent days”. The media interpret the letter as referring to CCB, with the BNB confirming that Gounev has taken leave from the central bank as a result of the pre-trial investigation against him.
BNB says that it has put CCB under special supervision at the lender’s own request. The lender’s shares are suspended from trading on the Bulgarian stock exchange, while the rights of shareholders with more than 10 per cent in CCB are temporarily suspended.
BNB says it has put CCB’s recently-acquired subsidiary Credit Agricole Bulgaria, under special supervision.
Russian banking group VTB, which holds 9.9 per cent in CCB, denies interest in participating in the recapitalisation of CCB, according to reports in Russian media.
BNB announces the start of the review of CCB’s assets and liabilities, ordered by the central bank. The auditors picked to carry out the review are Deloitte Audit, Ernst&Young and AFA.
CCB review deadline. BNB says it will announce the results “by the end of the week.”
BNB makes public the audit’s results – according to the auditors, loans worth 3.5 billion leva (out of CCB’s 5.4 billion leva credit portfolio) are missing paperwork. BNB says CCB’s licence will be repealed, while its “healthy part” will be merged with Credit Agricole Bulgaria, which will be nationalised and renamed. Two CCB officials are detained, while prosecutors say they are preparing to issue an international arrest warrant for Vassilev.
(Logo and corporate motto of Corporate Commercial Bank – “our clients are dear to us” – from a CCB advert. Screengrab from corpbank.bg)