The Bulgarian National Bank (BNB), the central bank of Bulgaria, has reportedly taken control of Corporate Commercial Bank, following severe cash crunch to meet client needs.
Also known as Corpbank, the Corporate Commercial Bank is one of the fourth-largest lenders by assets in the country.
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Following severe liquidity drain, the Bulgarian central bank suspended all client payments at Corpbank and its recently purchased subsidiary, Crédit Agricole Bulgaria, to avoid a possible collapse of the bank.
The central bank that regulates the country’s financial market, has also suspended shareholders’ rights in the troubled lender. Corpbank is partly owned by a unit of Russia’s VTB Bank and the sultanate of Oman.
During a news conference, Bulgaria central bank governor Ivan Iskrov said the central bank plans to pump fresh capital into bank in consultation with the shareholders; however, prior to that it will conduct auditing of Corpbank’s books.
Assuring the bank’s depositors, Iskrov said, "Let’s be very clear: Corporate Commercial Bank isn’t a bankrupt bank and we are acting swiftly to avoid a bankruptcy."
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By GlobalDataIskrov further added, "There has been a lot of talk about the bank and some of its shareholders, which triggered the run.
"It is very important to be very careful when we talk about banks. Let’s not topple our house unnecessarily."
