AMENDMENTS TO THE INSURANCE CODE MIGHT DRIVE INVESTORS AWAY
Dimitar Zhelev, Chairman of the Executive Committee of Allianz Bulgaria Holding and Chairman of the Management Board of Bulgaria Invest commercial bank, to the BANKER weeklyMr. Zhelev, the Ministry of Labour and Social Policy is currently preparing amendments to the Obligatory Social Insurance Code, which directly concern the relations between pension funds and their depositary banks. Do you have any objections to this project?- I will mention three main remarks to the presented amendments. The first one concerns the possibility for the depositary or trustee bank to be a related entity with a pension insurance company. I'd like to underline that this completely changes the initial investment intention of most banks. Two thirds of all insured individuals participate in funds of which banks are direct or indirect shareholders - Pension Insurance Company Allianz Bulgaria, Pension Insurance Company Doverie with the European Bank for Reconstruction and Development (EBRD) and Deutsche Bank as sharehodlers, Universal Pension Fund Rodina with DSK Bank as shareholder and ING Pension Insurance Company. I don't think all these serious foreign and Bulgarian institutions will accept the fact that the purpose for their investment - management of pension insurance funds' money, is being altered without any reason. I'm convinced there are plenty of mechanisms, especially in the power of bank supervision, to specify which banks cover the requirements for being depositaries. What do you think can be the consequences of a possible enforcement of these amendments without taking into consideration the remarks of owners of pension insurance companies?- I suppose in such case we will witness serious boycott on the part of all pension insurance companies. We will prepare a letter to Deputy PMs Lidiya Shouleva and Nikolai Vassilev, as well as to Finance Minister Milen Velchev and will present all our arguments against this requirement... And yet if it is accepted, we will reconsider our investment. It is even possible for Allianz Germany to withdraw from the Bulgarian pension insurance sector. After all, we cannot work within a legal frame which is completely different from the one when we made our initial investment.