Bulgaria's Central Bank Holds Meeting on KTB Recovery

Bulgarian National Bank (BNB) met on Friday representatives of Vienna-based fund EPIC, Oman's state fund and London-based Gemcorp, the central bank said in a statement.

During the talks held at the BNB's headquarters, the three investors declared they were in talks with the government and parliamentary represented political forces to draft a recapitalization plan for Corporate Commercial Bank (KTB or Corpbank).

Their idea includes state aid to save the bank.

Officials from the BNB reminded the newly-formed consortium that plans for recapitalization should come hand in hand with an evidence that the assets to be pumped into KTB are available and at disposal, the statement reads.

Deadlines and tools used to fulfill the investment plans will also have to be clearly stated by the consortium.

The three entities have demanded from the BNB access to the auditors' report on Corpbank's books prepared by AFA OOD, Deloitte Bulgaria OOD and Ernst & Young Audit OOD.

A summary of the audit's results was made public by the central bank on Wednesday this week revealing BGN 4.2 B of impairment costs on KTB's balance sheet. Dismissed KTB directors have called the report "a lampoon".

The BNB for its part is unable to grant access to the document without the auditors' consent, but has promised to cooperate.

Gemcorp was founded earlier this year by Atanas Bostandzhiev, the former CEO of VTB Capital who stepped down during the summer.

Bostandzhiev, who resigned briefly after the developments in KTB in mid-June, also claims his fund has already secured USD 500 M worth of financing.

Corpbank was placed under conservatorship after its liquidity was depleted by a bank run.

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