Bulgaria seizes Corpbank owner’s property

Customers demanding access to their deposits

SOFIA, Aug 26, (RTRS): A Bulgarian court has ordered the seizure of property belonging to the main owner of troubled Corporate Commercial Bank (Corpbank), a central bank deputy governor and six other officials, prosecutors said on Tuesday.

The fate of Bulgaria’s fourthlargest lender has been in limbo since June, when a run on deposits prompted the central bank to take control of it and close its operations, triggering the worst banking crisis in the Black Sea state since the 1990s.

Corpbank has since remained shut and customers are demanding access to their remaining deposits.

“On Aug 22, 2014, the Sofia City Court complied with the request of the Prosecutor’s Office and placed the properties of Tsvetan Vassilev under restraint,” prosecutors said in a statement about the bank’s main owner.

Vassilev, whose whereabouts are unknown, was locked in a public feud with a rival at the time of the run on Corpbank. Bulgarian prosecutors have charged him with embezzlement and said an international warrant for his arrest had been issued. He has denied any wrongdoing.

Assets

Prosecutors would not elaborate on the value of his assets, or the seized property of the other six Corpbank senior officials and the central bank’s Tsvetan Gounev.

Prosecutors said in June they had opened an investigation against Gounev into his role as banking supervisor.

Neither Gounev, his lawyer or the central bank responded to calls and emails asking for comment on Tuesday.

Both the central bank and Gounev’s lawyer have previously told Reuters Gounev would not comment on the investigation into him. The bank said in June he had taken voluntary leave of absence while the proceedings were under way.

Earlier this month, the central bank allowed some banking activities to resume so borrowers could repay loans to the bank, but deposits remain frozen.

The court’s move is unlikely to ease depositors’ fears.

“The decision has no direct connection with what will happen to the bank,” said Petar Ganev of the Sofia-based Institute for Market Economics. “It’s just part of the investigation.”