Sofia City Court Halts Insolvency Proceedings at KTB

Finance | November 24, 2014, Monday // 11:39|  views

Corpbank's headquarters in downtown Sofia. Photo by BGNES

The Sofia City Court has stopped insolvency proceedings launched at Corporate Commercial Bank (KTB).

At its first session on the case held Monday it thus complied with the appeal filed by KTB's majority owner Bromak with the Supreme Administrative Court.

The closed-door meeting included questioning representatives of KTB, the Bulgarian National Bank (BNB), the Sofia City Prosecutor's Office and the Deposit Insurance Fund (DIF).

Last week the court announced it might have to take the step, since the Bulgarian Law on Bank Bankruptcy provides for suspending the proceedings if a judicial appeal has blocked them until the administrative leagl controversy has been sorted out.

Earlier this month the BNB scrapped the license of KTB, and a court session was scheduled at the central bank's request for November 24.

The court's move will not affect repayment of deposits held at Corpbank by customers who have been waiting for months to have access to their savings.

Under current Bulgarian legislation deposits can be reimbursed as long as the central bank has declared a financial entity insolvent.

Payment is due to start on December 4, with the DIF expected to announce later on Monday which nine banks will be in charge.

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Tags: Corporate Commercial Bank, KTB, Corpbank, deposits, BNB, DIF, insolvency proceedings, Bromak

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