Fibank The Commissioner responsible in the EC for the competition policy, Ms Margrethe Vestager said: "I believe that today's decision of the European Commission will strengthen public confidence in First Investment Bank. The Bank presented a credible plan to restore the liquidity and a list of commitments that ensure Fibank will continue to be viable in the long term."
The European Commission found that the liquidity support is in line with all EU rules on state aid. The plan of Fibank (First Investment Bank) guarantees that the bank will continue to be viable in the long term without distortion of competition in the Single European Market.
After the panic withdrawal of deposits in June 2014, Bulgarian state granted to First Investment Bank liquidity support in the amount of 1.2 billion BGN as part of the Bulgarian liquidity scheme (http://europa.eu/rapid/press-release_IP-14-754_en.htm), approved by the European Commission. Due to the state budget restrictions then this deposit was with a short period maturing on November 28, 2014. Fibank (First Investment Bank) returned 300 million BGN of the granted amount on the maturity date and Bulgaria applied for an extension of the remaining 900 million BGN for 18 months from that date.
The European Commission found that the extension of liquidity support granted to First Investment Bank to 28 May 2016 meets the requirements for state aid to banks and the more stringent requirements of the Communication for banks of 2013. (http://europa.eu/rapid/press-release_IP-13-672_en.htm).
On November 12, 2014 First Investment Bank presented to the EC recovery plan for liquidity. The Bank undertaken to repay the liquidity support on the pre-set dates in the plan. Fibank made commitments to strengthen liquidity, improve the corporate governance structure and risk management policies. In order to limit any distortions of competition caused by the aid, First Investment Bank also committed to several restrictions during the period of use of the support, including not pay dividends, not to apply aggressive business practices and not to make acquisitions.
Independent supervisor will monitor the implementation of the restructuring plan and will provide regular reports to the European Commission.