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EXCLUSIVE-UPDATE 1-Bulgarian central bank governor ready to step down
July 22, 2014 / 1:15 PM / in 3 years

EXCLUSIVE-UPDATE 1-Bulgarian central bank governor ready to step down

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By Tsvetelia Tsolova

SOFIA, July 22 (Reuters) - Bulgaria’s central bank governor Ivan Iskrov is ready to step down if parliament agrees to appoint a successor, a spokesman for the bank said, adding that Iskrov has submitted a letter with this proposal to lawmakers.

In his letter, Iskrov said that he did not want the central bank to be subject to political attacks prior to an election due to be held in October, the spokesman said.

Boiko Borisov, leader of the opposition centre-right GERB party, has demanded Iskrov’s resignation, saying the governor has to take responsibility for a crisis that hit Corporate Commercial Bank (Corpbank) in June.

“The governor of the Bulgarian National Bank has sent a letter to the National Assembly, in which he expresses his readiness to resign if the assembly musters an agreement to choose a new governor,” the central bank spokesman told Reuters.

“The aim is not to leave the central bank without management during a continuing political crisis,” he said.

Depositors, unnerved by reports of shady deals involving Corpbank’s main owner, withdrew more than a fifth of the lender’s deposits in a week-long bank run. The owner has denied any wrongdoing and said the run on the bank was a plot hatched by his rivals.

The run prompted the central bank to seize control of Corpbank for three months, block depositors from taking out their money and commission an audit of Corpbank’s books.

Sofia has estimated the rescue cost at about 1.5-2 billion Bulgarian levs ($1-1.4 billion). The results of the audit showed activities in the bank “incompatible with the law and good banking practices” according to the central bank. It also said that crucial information about Corpbank’s loan portfolio was missing. ($1 = 1.4498 Bulgarian Levs) (Editing by Matthias Williams and John Stonestreet)

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