25.11.2014

The European Commission has approved the notified State aid for First Investment Bank AD. The Commission has found that liquidity measures granted by Bulgaria in favour of First Investment Bank (FIB) in Bulgaria were in line with EU state aid rules. The Commission concluded that the measures were necessary to preserve the financial stability of the Bulgarian economy and financial system. The Commission states that the restructuring plan will ensure that the bank continues to be viable in the long-term without unduly distorting competition in the Single Market.

We remind that Bulgaria granted liquidity support to FIB in the form of a state deposit of BGN 1,2 billion, as part of a Bulgarian liquidity scheme approved by the Commission on the same day - 29.06.2014. Due to Bulgarian Treasury constraints at the time, this deposit had a short maturity of five months expiring on 28 November 2014. For this reason the Ministry of Finance (MoF) notified before the EC new State aid for restructuring for First Investment Bank AD. The restructuring plan provides for an extension of the state deposit of BGN 900 million by a maximum of 18 months (until 28 May 2016).

The legal form for the State aid will be the conclusion of a contract for a fixed-term deposit between MoF and FIB before 28.11.2014, after the Government approves the draft contract and mandates the Minister of Finance to sign it.

You can find the EC press release HERE.