Bulgaria given emergency credit by European Commission

First Investment Bank, Bulgaria’s third biggest bank, had to close early on Friday after clients withdrew £327m, although the bank insisted it had capital and would open for business as normal on Monday. Question marks over liquidity also prompted the Bulgarian National Bank to place the country’s fourth biggest bank, the Corporate Commercial, under special supervision and freeze shareholder rights.

Some First Investment customers had apparently received text messages and emails on Friday urging them to withdraw their savings.

In an effort to calm the public Rosen Plevneliev, the Bulgarian president, said “there is no banking crisis but a crisis in confidence and criminal attacks”.

“We have sufficient reserves, means and tools to deal with any attempt at destabilization, and we stand behind each bank that becomes the target of an attack,” he added. The crisis has, however, come as the final nail in the coffin of Bulgaria’s left-wing coalition government. The subject of numerous and persistent street protests, the government said it would resign at the end of July at the latest.

An interim government will serve in office till elections on October 5.

more