Банкеръ Weekly



The proposal for cancellation of Paragraph 3, Article 220 of the Penal Code arose quite a commotion in the parliamentary Legal Issues Commission. Its provisions stipulate legal prosecution for bankers who have extended unguaranteed credits which are not served. This paragraph was included in Penal Code after former premier Ivan Kostov's government enforced the Credit Millionaires Act. It was supposed to hold responsible those bankers who have launched credits without exacting the necessary guarantees and who have thus contributed to the 1996 bank crisis. Therefore, all MPs from the parliamentary group of the United Democratic Forces (UDF-coalition) stood most eagerly behind the paragraph's being preserved. Their motive was the emerging threat that new credit millionaires might appear. Jordan Sokolov described the draft for amendment of Paragraph 3, Article 220 as extremely dangerous as it might provoke another bank collapse similar to the 1995-1996 one when 16 commercial banks went bankrupt. The amendments of the Penal Code were brought forward by Valery Dimitrov, Chairman of the parliamentary Political Commission and by a group of MPs from the National Movement Simeon II (NMSII). Representatives of NMSII offered as couterargument the fact that Paragraph 3 restricts crediting in the country. According to Valery Dimitrov unguaranteed crediting is connected only with additional risk taken by bankers. Yet to seek legal prosecution on this issue would mean hampering entrepreneurial activity. Svetoslav Louchnikov (another UDF deputy) underlined that the present text should undergo such amendments which to enable bankers to take reasonable risks on one hand, and on the other prevent the danger this to turn into a wide-spread practice.His opinion was supported by his colleague and fellow partymember Eliana Maseva - former chairman of the Supervisory Board of DSK Bank. The fact that almost all the banks are private at the moment does not mean that money-laundering threat should be neglected, she said.Actually most of the bankrupted in 1996 banks were private, too. And it is not a secret that the best part of the drained assets were guaranteed though only on paper. So linking unguaranteed credits to actual crime is hardly the best means to protect the banking sector from draining.MPs from the NMSII share the opinion that unguaranteed crediting cannot be defined as deliberately unprofitable deal which should be prosecuted. Dimitar Ananiev, Head of the Law Department of the Bulgarian National Bank (BNB), also backed NMSII's thesis. He explains the bank crisis in 1995 - 1996 not with unguaranteed crediting, but mainly with breaches of all the obligatory rules of the BNB for risk distribution. NMSII's deputies voted the casus to be discussed at a plenary session. This is a criminal law problem and everything which happened five years ago is off the matter. Seeking responsibility for launching unguaranteed credits exceeds any legal logic, concluded NMSII's MP Borislav Ralchev.

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