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Bulgaria orders state-owned companies to diversify deposits

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(Globalpost/GlobalPost)

Bulgaria's caretaker government approved Wednesday new regulations requiring state-owned companies to diversify their deposits in local banks to end the current concentration of funds in one institution.

The new rules oblige all companies with a government stake of over 50 percent to hold no more than 25 percent of their funds in one lender.

Companies were given a six-month deadline to comply.

About 54 percent of the money of Bulgaria's state-owned firms are currently concentrated in a single bank, caretaker Prime Minister Marin Raykov said last month, citing data from the end of March.

Raykov refused to name the institution, but Bulgarian media reports said the bank in question was the Corporate Commercial Bank (CCB) owned by businessman Tsvetan Vasilev.

In the past five years the bank has funded the acquisition of a number of national and regional newspapers, newspaper distribution companies, television channels and news websites by the New Bulgarian Media Group Holding of lawmaker Delyan Peevski.

Experts have slammed the holding for its near-monopoly on Bulgaria's media market, accusing it of pushing the business interests of CCB and trying to influence political decisions.

Bulgaria's media consolidation was mentioned in the US State Department's latest report on human rights practices that said "print and electronic media were criticised domestically and internationally for lack of ownership and financial transparency as well as for susceptibility to economic and political influence."

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http://www.globalpost.com/dispatch/news/afp/130522/bulgaria-orders-state-owned-companies-diversify-deposits