site.btaCourt Halts Registration of Bulgarian Development Bank Management Changes for Second Time

June 30 (BTA) - The Sofia City Court (SCC) has halted for
 the second time the registration of Bulgarian Development Bank
(BDB) Supervisory Board and Management Board changes, a lookup
in the Commercial Register shows. This latest court decision was
 made on Tuesday, June 29, and is appealable before the Sofia
Appellate Court.

The BDB management controversy started when caretaker Economy
Minister Kiril Petkov said shortly after taking office in early
May that he was shocked to find that eight companies had
received a total of 946 million leva in loans from the BDB. The
BDB is supposed to lend to small and medium-sized businesses.
Petkov argued that the large loans were at odds with the BDB Act
 and the BDB Articles of Association. In mid-June, the Bulgarian
 National Bank (BNB, the central bank) approved new Articles of
Association for the BDB, according to which the Supervisory
Board and the Management Board may each be enlarged from three
members to a maximum of seven. The BNB also approved three new
executive directors at the BDB.

The registration of the management changes was halted following
objections by sitting and recently dismissed members of the BDB
management. On Tuesday, the BDB lodged an appeal with the Sofia
Appellate Court against the halted registrations. The Economy
Ministry joined the appeal. It reasoned that the registrations
were stopped unlawfully because the management changes had been
approved by the central bank.

The second attempt to get the registrations done by order of a
different SCC judge was thwarted after complaints by BDB
Supervisory Board member Velina Burska and Executive Director
Nikolai Dimitrov. The two argue that the decisions by the
Economy Minister and the BDB Supervisory Board on June 23, by
which new management members were elected, are null and void.
RY/VE

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