GERB Withdraws Proposal to Save KTB Through Legal Changes

Business » FINANCE | October 31, 2014, Friday // 13:29
Bulgaria: GERB Withdraws Proposal to Save KTB Through Legal Changes Menda Stoyanova. Photo by BGNES

Conservative GERB has renounced its proposal for legislative amendments that could restore troubled Corporate Commercial Bank (KTB) back to health.

The center-right party had submitted a draft bill under which Bulgaria's central bank BNB would have to save banks that have reported negative equity.

GERB is the biggest party in Parliament with 84 out of 240 MPs.

It first announced the idea in Parliament during this week's first sitting of a temporary committee chaired by GERB's Menda Stoyanova and set up to work toward a decision on KTB.

On Friday, however, Stoyanova said her party was making a step back.

The original idea of this draft piece of legislation was to prepare "in the short term... amendments to the Credit Institutions Act which could transpose texts from the EU [Deposits Guarantee Schemes] Directive, with our obligation having a deadline until December 31," the website dnevnik.bg quoted her as saying.

Conservatives had previously insisted KTB should not be saved with state money.

Now it is backtracking after, in Stoyanova's words, the offer of "potential investors" proposing to contribute to Corpbank's recovery is "not serious".

On Friday, a consortium of investors submitted a proposal to participate inject BGN 2.3 B in KTB, but authorities are yet to respond.

GERB, on the other hand, will not renounce its proposal to speed up the Directive's transposition (until November 6, and not until June as it is now envisaged) to ensure that depositors at KTB have access to their savings.

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Tags: Menda Stoyanova, GERB, BNB, Corporate Commercial Bank, KTB, Corpbank

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