site.btaBanker Hampartsoumyan: Payment of Guaranteed Deposits in Struggling CorpBank to Cost State At Least 1,500 Million Leva

Banker Hampartsoumyan: Payment of Guaranteed Deposits in Struggling CorpBank to
Cost State At Least 1,500 Million Leva

Sofia, October 23 (BTA) - The Corporate Commercial Bank
(CorpBank, placed under special supervision in late June) is
"technically not bankrupt" but the most likely scenario for it
is withdrawal of the license and insolvency, Chairman of the
Governing Board of the Association of Banks in Bulgaria and
Executive Director of UniCredit Bulbank Levon Hampartsoumyan
said during a morning TV broadcast on Thursday.

Hampartsoumyan said that the State will need to take out a new
loan to the amount of 1,500 million leva for the payment of the
guaranteed deposits in CorpBank, with the remaining needed
amount of 2,000 million leva coming from provisions banks have
been paying from their profits back since 1998.

"If someone wants to fill a bottomless tub, it is theoretically
possible to revive the bank. This would require a liquid
resource of 4-5,000 million leva, or the same as demanding 2,000
leva each from the working Bulgarians," Hampartsoumyan said.

He was adamant that CorpBank's borrowers: businesses and
individuals, will repay their loans but some of these could be
written off.

The banker said that the more than 4,000 million leva hole
established in CorpBank is what the auditors expect to be
missing at the end of the year on the basis of secured and
serviced loans. Hampartsoumyan said that the letter-box
companies used accounting tricks to create the impression they
were paying their obligations.

Hampartsoumyan noted that the management of CorpBank, as well as
the relevant institutions in this country, are to blame for the
current situation. In his words, the central bank has excellent
experts whom it is impossible to hoodwink for a very long time.


Hampartsoumyan described it as paradoxical that CorpBank's
lending to a narrow circle of linked people limits the effect of
its collapse on the banking system.

Commenting the awards conferred on CorpBank and on its head
during the years, Hampartsoumyan said this was done based on the
data that the bank developed very rapidly.