/ world today news/ Documents for 3.5 billion credits in KTB are missing
On June 20, Friday, at 11:40 a.m., the BNB received a request from the management of KTB to place the bank under special supervision.
By law, the Central Bank is obliged to comply with the request. This was done – first at KTB, and then at its affiliated bank “Credit Agricol Bulgaria”, Ivan Iskrov reported. Conservators were appointed in both banks of the KTB group, and independent auditors entered on June 25. The aim was to review the assets and liabilities of the banks.
Auditors report that substantial parts of the credit files for a credit portfolio amounting to BGN 3.5 billion were missing, and more likely destroyed, in the days before the quaestary. Given that the bank’s total loan portfolio is BGN 5.4 billion, a significant part of this portfolio points to a very strong connection between the debtors and the bank’s majority shareholder, Tsvetan Vassilev, the auditors write. As a result of the lack of sufficient information, the auditors express the opinion that it is not possible to assess the financial condition of the debtors and their ability to service their loans. They do not say whether the loans are good or bad, but that they have no information on which to base their assessment, Iskrov commented. The availability and quality of collateral cannot be assessed, which leads to the impossibility of drawing up a final conclusion on the state of the credit portfolio in that part of it, which is in the amount of BGN 3.5 billion. Unfortunately, these actions cannot be registered with the tools of remote banking supervision and suggest intentional abuses, Iskrov pointed out. These actions of KTB officials may lead to deliberate damage to the bank with hundreds of millions of BGN. It is obvious that the minority shareholders in KTB are also victims of these abuses, according to the governor of the BNB. Therefore, the auditors’ report was submitted to the Attorney General yesterday.
“On June 18, 19 and 20, after numerous media publications and, in our opinion, a strange press conference by the then management of KTB, sums of nearly BGN 1 billion were withdrawn from the bank,” Iskrov also pointed out.
The amount that was withdrawn from KTB is worth BGN 205,887,223. The money was withdrawn on June 19, just a day before the bank was placed under special supervision, announced BNB governor Ivan Iskrov. According to a check by the custodians appointed in KTB, the withdrawal of the colossal amount was made through a third party. The bundles were handed over only against a receipt of Tsvetan Vassilev. Most banknotes were in euros. “We were shocked, as we cannot imagine such a large amount of banknotes, but let the colleagues from the Sofia City Prosecutor’s Office and the investigation answer this question,” Iskrov commented. According to him, it should be seen whether this money was taken out of the country and, if so, how it happened and who was on duty at the border crossings and airports. “What act this is and what actions should be taken is within the competence of the prosecutor’s office. The investigating authorities can answer the question of whether the majority owner Tsvetan Vassilev robbed his own bank in this way,” said Iskrov. And he assured that the prosecution can fully rely on the expert potential of the BNB. The conservators’ data on the withdrawal of over BGN 205 million in cash from KTB was already submitted to the chief prosecutor on July 9 due to suspicions of criminal actions by persons connected to the bank, Iskrov said.
However, the drain on the bank began much earlier. This is clear from the reports of the independent auditors who entered KTB and Credit Agricole to review their assets and liabilities. The conclusions of the review regarding “Credi Agricol Bulgaria” are positive. It is a well run bank with good banking practices. The condition of her credit portfolio is very good. Its security and the necessary provisions are at a sufficiently high and good level, the auditors write. Credit Agricole was acquired by KTB very recently.
However, the results of the KTB review speak of actions incompatible with the law and good banking practices, Iskrov said.
“From now on, the BNB together with the government will concentrate on the restructuring and recovery of the good part of KTB with a view to protecting the interests of all its depositors,” said Iskrov.
Deterioration started 12 months ago
Dimitar Kostov, Deputy Governor of the BNB, Banking and Fiscal Services Departments
About 40% of KTB’s loan portfolio was generated in the last 12 months. In addition, in the course of the inspection, comparing the degree of completeness of the documentation, it turned out that during the last 12 months there was a violation of the completeness of the documents. If 12 months ago there were any reports on the financial condition of the companies to which loans are granted, or on the quality of the collateral, then they are no longer there. Notwithstanding that the legal requirement is to have reports, for example for the previous year. I.e. we observe a deterioration in the quality of control and the quality of lending. Companies begin to appear where the volume of business does not correspond to the volume of credit, with ambiguity about the intended use of credits – ie. there are no documents in the file to confirm their intended use.
Yovchev: There is evidence of a serious crime
Apparently, money is missing from KTB, a pre-trial proceeding has been initiated, but against whom – I cannot say now. This was stated by the Deputy Prime Minister and Minister of the Interior Tsvetlin Yovchev, quoted by BGNES. “There is evidence of a serious crime and it is currently being investigated. The situation at KTB is radically different from the situation at other banks and nothing will remain without the investigators taking certain actions,” Yovchev said.
When asked whether criminal responsibility for the distribution of unsecured loans should be returned, Yovchev answered evasively: “We should think in this direction, but if such a measure is adopted, purely commercial operations will become more difficult.”
Eyebrows: He loaded 1.7 billion on a plane
Tsvetan Vasilev stole BGN 1.7 billion from KTB, GERB deputy Vezhdi Rashidov told journalists. Yesterday, he submitted to the prosecutor’s office an anonymous letter that he received by mail. The letter was signed by several people who put only their initials. Rashidov stated that he recognized some of them as people from the Management Board of KTB. According to the deputy from GERB, the letter describes how Vassilev prepared the theft of the money within 27 days. According to him, the funds were exported in cash and loaded on a private plane. Asked why he himself invested his money in KTB, Rashidov stated that he was interested in which bank gave the best conditions and was looking for his own interest.
An inspection by “Standard” found that flights from the territory of Bulgaria to foreign airports can only be carried out from the 5 international airports – Sofia, Varna, Burgas, Plovdiv and Gorna Oryahovitsa. Small planes can also leave the territory of the country only from one of the 5 specified airports. However, there is also a practice where, according to an agreement between the Ministry of Internal Affairs and the Ministry of Finance and a small airport, a mobile group of customs officers and border police officers arrives to check a specific flight, upon prior request.
Handcuffs for the boss and the cashier
Orlin Rusev ordered, and Margarita Petrova took out the bundles, which were taken out in sacks
The executive director of KTB Orlin Rusev was arrested yesterday in Sozopol, the prosecutor’s office announced. The news came a few hours after the BNB announced that reports had been made that over BGN 205 million had been withdrawn from the bank a day before the BNB conservators entered it. There is evidence that Orlin Rusev personally ordered 205,887,223 to be taken out of the bank’s vault and given to third parties, the official announcement of the state prosecution says. It is clear from it that on Wednesday late in the afternoon the governor of the BNB filed a report with the chief prosecutor, accompanied by copies of documents.
The report states that the previous day the BNB was notified by the conservators of an illegal withdrawal of unusually large amounts from the bank’s treasury. It is about 93,139,500 euros, 23,657,575 leva and 45 thousand US dollars. The chief cashier of KTB, Margarita Petrova, was arrested and charged for the withdrawn amount. According to the prosecutor’s office, she took the money out of the safe in sacks and handed it over to third parties, without clarifying who they were. The prosecutor’s office has charged Petrova with embezzlement on a particularly large scale. The prescribed punishment in the Criminal Code, if proven guilty, is from 10 to 20 years in prison. Petrova was ordered detained for up to 72 hours. In this period, a request will be prepared to the court for taking a measure of remand “detention in custody”. It is also clear from the announcement of the state prosecution that documents are also being prepared for summoning Tsvetan Vasilev under the order of international legal assistance. According to the latest information about him, he resides in Vienna. Many witnesses have already been interviewed, documents and security camera recordings have been seized, graphological and technical expertise has been appointed. An inspection of the vault of KTB AD is also being conducted.
“I have information that the arrested head of the KTB Board of Directors, Orlin Rusev, is a protected witness in the KTB case”.
The surprising news was announced by financier Stoyan Alexandrov in an interview with BPost.bg. According to him, two of the top management of the bank alerted the law enforcement authorities about the withdrawal of millions in cash. They announced that they did not agree with the financial operation to withdraw over 205 million BGN in cash the day before the entry of the quaestors and they alerted the prosecutor’s office. Therefore, the bankers already had the status of protected witnesses, Aleksandrov claims.
The detained Orlin Rusev was born in 1967, according to a reference on the KTB website. He started his career at Central Bank in 1993. From 1999, for one year, he was the head of the “Left currency and markets” department at Bulgaria Invest. In 2000, he joined KTB as the head of the “Lev Stock and Securities” Department, and in the period 2002 – 2003 he was its procurator. Since 21.07.2003 he has been the executive director, and since 04.02.2005 he has also been the chairman of the Board. Responsible for liquidity, security, accounting, customer service and activity related to statistics and banking regulators.
Tsvetan Vassilev: We will talk in court
We will talk in court with the institutions that cooperated and did not act in order for all this to happen, says an open letter distributed by Tsvetan Vassilev. It claims that a massive, targeted and manipulative campaign has been launched against the banker for several months, which has also spread to everything related to his name. The main target of the unprecedented pressure is KTB, the letter says. Vassilev claims that the files on the loans given out have not disappeared, but are in the investigative bodies. “It did not become clear how and in what way the money for which I am accused was taken and handed over to me, given that I have not been in Bulgaria since June 10, 2014,” the letter reads. “I want to inform the public that I have given notarized testimony before judges from EU member countries,” the message, signed by Tsvetan Vasilev, also says.
Later, Tsvetan Vasilev announced to BTV that he would return from Vienna to Bulgaria in a few days and give evidence to the authorized authorities and his version of the state of the bank.
They fired the head of VIP at Sofia airport
Boris Popov, the permanent director of VIP at Sofia Airport for two decades, was yesterday dismissed by the executive director of the airport, Hristo Shcherionov. This was confirmed by Shterionov himself to “Standard”. Popov was released by my order, but the reasons for this have nothing to do with the problems in the banking sector, said Shterionov. According to people in the know, Boris Popov is of retirement age. However, the prosecutor’s office did not comment on the information that Popov’s release was related to the audit of KTB and the withdrawal of over 200 million from the bank. “We cannot comment on whether the export of this money took place through the VIP terminal at Sofia Airport,” prosecutors said.
They check the quality of the audits
The Commission for Public Supervision of Registered Auditors has self-reported and verifies the quality of KTB’s audits. This became clear from the words of the governor of the BNB, Ivan Iskrov, at a meeting of the budget committee in the parliament.
Before the deputies, he presented the results of the audit commissioned by the BNB in the bank. The inspection was carried out jointly by “Deloitte Audit”, “Ernst & Young” and “Afa” OOD. Until now, KTB’s annual reports were certified by KPMG Bulgaria.
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