The assessment of the state of Corporate Commercial Bank (KTB) should be completed in early October, caretaker Finance Minister Rumen Porozhanov said on Monday.

"A Vienna-based fund has declared interest in drafting a recovery plan for the bank based on this assessment,” Porozhanov told Nova TV channel. “For me, this is the best option”.

The potential investors are expected to sign a confidentiality agreement with the central bank and begin receiving information about the state of KTB from the central bank-appointed administrators.

Referring to the infringement procedure opened by the European Commission against Bulgaria for its failure to allow clients of Corporate Commercial Bank (KTB) access to their money, Porozhanov said that the EU executive body is discussing with Bulgarian authorities whether the EU’s Deposit Guarantee Scheme (DGS) Directive has been correctly transposed in Bulgarian law to allow depositors access to their money as early as possible after it emerges that a commercial bank is faced with liquidity problems.

Bulgaria’s current regulations for special supervision of troubled commercial banks by the central bank don’t provide for allowing depositors in those banks access to their state-guaranteed money before such banks are stripped of their banking licence.

The European Commission stated that Bulgaria had failed to correctly transpose in national law two articles of the Directive to comply with the principle of free movement of capital within the EU. The Commission also said that it expects that depositors in KTB will be given immediate access to the amount of bank deposits to which they are entitled.

 “Our law envisages a special case for allowing access to funds: after a bank is declared insolvent and is stripped of its licence,” Porozhanov explained. “This means insolvency.”

The finance minister went on to say that five years ago, when Bulgaria sent its legislation on special supervision to the Commission to verify their compliance with EU law, there was no problem.

In practice, though, the period of special supervision over a troubled bank can last three months, which can be extended by a further three months, which contravenes EU’s directive stating that denying depositors access to their money for more than 20 days could be a problem.

“We are working on a law that will synchronize Bulgaria’s legislation with the Directive,”said Porozhanov.