site.btaMay 3, 2016: AlixPartners' Report on Corpbank Published in Bulgarian

The results of an investigation by consultants AlixPartners Services UK LLP, the company hired by the Bulgarian Deposit Insurance Fund to track and recover money from the insolvent lender, Corporate Commercial Bank, the fifth-largest bank in Bulgaria, based on assets, at the time, were made public after Parliament mandated it despite the consultant’s opposition in May 2016. The report claimed that companies directly or indirectly linked to Tsvetan Vassilev, Corpbank’s majority shareholder and chief executive, received an estimated BGN 2.5 billion, or about EUR 1.3 billion, in loans from the bank.

In August 2014, an international arrest warrant was issued for Vassilev. A month later, Vassilev turned himself in to authorities in Serbia. Vassilev currently lives in exile in Serbia where he was granted political asylum.

 In July 2017, Bulgaria’s prosecution service lodged court action against Vassilev and 17 other defendants, mostly former senior Corpbank employees but also two auditors from KPMG Bulgaria and three former Bulgarian National Bank employees, including former deputy governors in charge of bank supervision.

Following is the BTA English Language Service's report on May 3, 2016:

AlixPartners' Report on Corpbank Published in Bulgarian

Sofia, May 3 (BTA) - Tsvetan Vassilev, the majority owner of Corporate Commercial Bank (Corpbank) which collapsed in 2014, and his associates received most of the bank's loans, Bulgarian National Television said, quoting a report by AlixPartners Services UK LLP. It says Corpbank, formerly Bulgaria's fourth biggest lender, was involved in investments and deals to its own detriment. Large sums were siphoned from it on several occasions through those transactions.

The trustees in bankruptcy published the Bulgarian translation of the report on the bank's website on Tuesday afternoon. The report contains the names of the main companies and schemes involved in Corpbank's siphoning since 2009.

The 575-page report also says that 243 corporate clients held nearly 500 outstanding loans. The auditors expect the trustees to recover 800 million leva at the most within a 12-month period.

The Bulgarian Deposit Insurance Fund repaid 3.6 billion leva in guaranteed deposits with Corpbank.

AlixPartners Services UK was hired in June 2015 by the trustees in bankruptcy to track and recover the failed bank's assets. The firm submitted its report on September 23, 2015. On April 14, 2016, Parliament amended the Bank Bankruptcy Act to allow for the disclosure of the report notwithstanding the contractual confidentiality clauses.

Analysis of Corpbank's activity since 2009 shows widespread use of loans to borrowers as a conduit for financing wrongfully or illegally siphoned from the bank, according to the report quoted by mediapool.bg. Apparently, in most cases the majority shareholder and his associates benefited from this.

In July 2014, the Bulgarian prosecution authorities charged Vassilev, who is now in Serbia, with embezzling 206 million leva from Corpbank. 
VI/DS,DD