Bulgarian National Bank Governor: Banking System Stable
Bulgarian central bank Governor Ivan Iskrov has issued an official statement on rumors and speculations questioning the stability of certain Bulgarian banks.
He has described information propagated online as malicious and has denied Bulgaria's banking system could be in jeopardy.
The full text of his statement dating June 27, 2014 is below.
BNB has repeatedly underscored that the Bulgarian banking system has good indicators and operates smoothly and seamlessly. That notwithstanding, over the last days an attempt is being made to destabilize the state through an organized attack on Bulgarian banks without any grounds. Since yesterday, an attack has been carried out against one of the biggest among them - First Investment Bank - through an outbreak of rumors and ill-intentioned public statements. Such criminal actions are directly targeting the savings of every Bulgarian citizens and the financial stability as a basic element of the country's national security.
The Bulgarian National Bank declares categorically that it is to use all means and resources it has at disposal to safeguard people's savings.
We are referring to Parliament, the Government and the President of the country for support of our actions aimed at protecting the financial and bank stability for the benefit of Bulgaria and its citizens.
We insist that authorities, including Prosecution, Interior Ministry and [State Agency for National Security] DANS, apply the law to the fullest extent against the propagators of false and malicious rumors and speculations.
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Why should we believe these statements of the NBB?
"the BNB has been turning a blind eye to some local banks' concentration risk in companies linked to their owners, and may be underestimating Non Performing Loans and overestimating coverage due to inflated collateral figures given by banks" - See more at: http://www.novinite.com/articles/150009/Tough+Road+Ahead+for+Bulgaria%27s+Banks#sthash.axU9lvKb.dpuf
In fact, some so called "banks" are the official "murky debt collectors" from the past. Giving bad loans "with pleasure" (some of them own more than 45% NPL's), wait a year and then confiscate the assets for a bargain price.
Better to stay away from these people. The current bank run is the logical consequence. Sadly, the BG taxpayer will pay fortunes, since they are all covered by political friends. Once more thousands of people will remain deprived from medical care and proper education money!