Emil Harsev: KTB Insolvency Would Be Ungrounded

There is not a single reason requiring that Corporate Commercial Bank (Corpbank or KTB) be declared insolvent, financier Emil Harsev believes.

Harsev, who is part of the Initiative Committee for Solution to the KTB Crisis, told public broadcaster BNR that the losses would affect the state, customers and depositors at the same time.

"Losses will be incommensurable to all projected expenses to rescue the bank," he argued.

In his view, all the figures received by the team carrying out the special supervision of Corpbank show the stabilization of the bank is possible and effort should be put forth toward that goal.

Commenting on the actions of the Bulgarian National Bank (BNB), which imposed conservatorship on KTB in June after a bank run depleting its liquidity, he blamed the institution for failing to take the vital decisions that would help KTB, but would also require responsibility and would carry financial risks.

"I suppose they are waiting to be granted support from a Parliament, from a future government with a permanent mandate," Harsev noted.

Bulgaria is currently ruled by a caretaker government and has no Parliament after the elected cabinet resigned on July 23 and the National Assembly was dissolved on August 6.

"This is having a negative impact. I don't know why they are not taking this decision which could for instance solve the issue with one of the two banks," the financier said, referring to Corpbank on the one hand and its subsidiary, Victoria (formerly Credit Agricole Bulgaria).

"We are talking about a certain amount of money which the Bulgarian Development Bank has got" and which it should have "no problem" to transfer to KTB, according to Hersev.

"This would improve the stand of KTB and would immediately put the smaller commercial bank, Victoria, back on track, with its customers able to access their money immediately. The BNB-appointed auditors themselves support that conclusion as well," he stressed.

Harsev made his point as experts were set to gather at the Bulgarian Industrial Association, where bank experts, trade-union officials and employers had agreed to discuss the situation at KTB, with National Ombudsman Konstantin Penchev also attending.

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