Bulgaria to Start Repaying Deposits in KTB Dec 4
Bulgaria’s Deposit Insurance Fund said on Thursday that from 4 December 2014 it will start repaying state-protected deposits in Corporate Commercial Bank (KTB), which had its banking license withdrawn earlier in the day.
The Fund protects depositors’ funds in banks of up to BGN 196,000 (EUR 100,000), as well as creditors’ interests in bank bankruptcy proceedings, thus promoting stability of and confidence in the banking system.
The protected amount comprises deposit principal plus interest accumulated as of November 6. Foreign currency-denominated deposits will be repaid in Bulgarian levs at the Bulgarian central bank’s official exchange rate for the starting day of the repayment, the Deposit Insurance Fund said in a statement.
Considering the large number of depositors in KTB, the repayment will be made through several banks to be designated by the Fund.
The Fund will announce the names of the banks that will service the repayment as well as the distribution of depositors among those banks no later than November 25. The announcement will be posted on dif.bg and distributed via media channels including two daily newspapers with nationwide circulation.
Holders of insured deposits in KTB will have access to the full amount of their funds through the banks servicing the repayment. Those depositors will be able to withdraw their funds, deposit them with the servicing bank or order their transfer to accounts in other banks.
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The lesson I've taken from this fiasco is:
Don't leave any more money than your prepared to lose in a Bulgarian bank account.
The Deposit Insurance Fund is supposed to promote stability and confidence in the banking system, I think it would be fair to say it has failed entirely in this case.