JOTEV G…TS BCC INTO A PRETTY MESS?
Peter Jotev - incumbent Deputy Premier and Executive Director of the Bank Consolidation Company (BCC) - has made an ingenious move, turning the BCC an owner of litigious receivables. The BANKER weekly was the first to inform that on May 2, 2001, SG EXPRESSBANK transferred its receivables from Dolphin 1 Ltd and Bulunion Ltd to the BCC. However, Mr Jotev knew that both receivables would be litigated in court.
For example, Dolphin 1 Ltd claims that it does not owe SG EXPRESSBANK BGL3,369,400, but the credit institution has transferred this receivable to the BCC. It is impossible for the Deputy Premier to have not realized that if the case is resolved in favour of the company, the BCC would get into a pretty mess. It is true that SG EXPRESSBANK had won the lawsuit against Dolphin 1 at the Varna Regional Court, but on June 12, 2001 the Varna Court of Appeal revoked the ruling of the regional magistartes. Of course, this ruling can be appealed at the Supreme Court of Cassation, but there could be no guarantee that it will not confirm the decision of the Varna Court of Appeal. So it is not clear what Deputy PM Jotev counted on when he assumed the prerogatives of the Supreme Court of Cassation and hurried to ackwnowledge that Dophin 1 Ltd owned money to SG EXPRESSBANK.
Whatever the outcome of the lawsuit is, it is clear that at the end of his term in office as Deputy Premier and head of the BCC, Mr Jotev succeeded to get the BCC into a quite intricate scheme. It is true that the liabilities of both Bulunion Ltd and Dolphin 1 Ltd are connected with the bankrupt Varna Shipyard. It was the shipyard's debt of USD20.5MN to SG EXPRESSBANK, which the BCC bought in 1999, paying some USD6MN. In addition, the BCC acquired the mortgages on three vessels, which were put in pledge for these receivables.
But what did the BCC collect within the past two years - nothing at all. But instead of taking a lesson to heart from that deal, a month and a half before the end of his mandate Mr Jotev jumped into similar operations with dubious advantage for the BCC. In that respect it is not clear why the Deputy Premier used the BCC for risky ventures. The final result would hardly help the financial performance of the BCC, and the budget will continue to rely on a considerable portion of its profit, which was BGL456.7MN in 2000.