Банкеръ Weekly

Briefs

STATE-OWNED BANKS SELLER HOLDS BGN12.5MN ON ITS ACCOUNTS

The ordinary annual general meeting of the Bank Consolidation Company (BCC) which is under liquidation procedure took place in Sofia on June 30. Nelly Kordovska, liquidator of the company, announced that the company's 2005 net income (after tax) amounted to BGN4.5MN. A major contribution resulted from the sale of BCC's receivable from the Varna-based Delfin company which brought a net amount of BGN2.26MN to the consolidation company.
At first sight it seems a little strange that a company that was created to consolidate and privatise state-owned banks and spent its entire 12-year life doing so has a receivable from a private firm. We should remind that BCC neither financed Delfin nor issued guarantees for loans received by the company. Its receivable results from the deal signed with Societe Generale which acquired EXPRESSBANK (now Societe Generale EXPRESSBANK) in 1999. The agreement signed by BCC and the French contained a clause reading that the company was to acquire all receivables of the bank from the Varna Shipyard (declared insolvent at the time). This also referred to the credits launched to companies linked to the Varna-based enterprise. The list included the loan of Delfin which occupied with shipyard activities. In 1998, the company received a BGN4MN loan from EXPRESSBANK which was transferred from its accounts as financing to the accounts of the shipyard. However, Delfin was the titular on the loan. This is why in 1999 the already privatised EXPRESSBANK deducted EUR131,000 from the company accounts in order to cover the credit instalment due. The move provoked a scandal between the bank and Delfin owner Kaloyana Dimitrova who claimed she did not owe money on the credit and the deduction was illegal. They led legal proceedings which transformed into trade case between Delfin and BCC in 2002 as the bank transferred its receivable to the consolidation company. Legal debates ended on July 6 2004, when the Supreme Cassation Court confirmed BCC was to receive the amount from Delfin. The two sides settled the payment of BGN2.26MN to BCC accounts out of court and the money was transferred in 2005.
The transfer from Delfin included, BCC accounts contain BGN12.5MN. The money will be distributed among the company shareholders. However, it will happen when all shareholders are specified. According to Nelly Kordovska, there are some legal issues concerning the owners of a few minority stakes to be settled first, as the companies written in the shareholders' book no longer exist and were erased from the company registers in the courts. However, Mrs. Kordovska is convinced the liquidation will end by the deadline fixed - October 31, and in November BCC will only be history.

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