SOFIA CITY COURT TO DECIDE IF CORPBANK IS TO BE SUBJECT TO INSOLVENCY – DECISION EXPECTED WITHIN 7 DAYS

On 15th of April, Sofia City Court held a hearing on the insolvency case of Corporate Commercial Bank (CCB) in closed session. The court’s ruling is expected within a week.

The court held a closed session in response to a request of the interim receivers and the Bulgarian Deposit Insurance Fund, based on a provision of the Bank Insolvency Law. The other parties in the legal proceedings were the Bulgarian National Bank (BNB), Bulgaria’s Prosecutor’s Office and the two largest shareholders in CCB.

The request for opening of bankruptcy proceedings was lodged by Bulgaria’s central bank (BNB) to the competent court after the revoking of the CCB’s license in November.

If the court decides that an insolvency proceeding at CCB should be opened, there will be time-limits within which the receivers have to make a list of creditors. The court has explained that irrespective of how quickly the procedure is moved forward, the winding-up would be possible to start in a year and 2 months at the earliest, because of the time-limits for registration of creditors and the time-limits for appeal as referred to in the law.

On 6th of November, 2014, the BNB Governing Council revoked CCB’s banking license and on 7th of November, a petition for opening of insolvency proceedings against CCB was submitted to Sofia City Court. On 24th of November, Sofia City Court stopped the legal proceeding against CCB until the Supreme Administrative Court (SAC) rules on the appeal against the revoking of CCB's license. The proceedings were resumed after the Supreme Administrative Court ruled on 2nd of April to reject the appeal.