Peak Ponzi: Only 13% Of Loans In Bulgaria’s Fourth Largest Bank Had Valid Collateral

Peak Ponzi: Only 13% Of Loans In Bulgaria’s Fourth Largest Bank Had Valid Collateral (ZeroHedge, Oct 22, 2014):

One can debate whether, by virtue of fractional reserve banking, every bank in the world is just a ponzi scheme, and where the stability of the system depends entirely on the level of counterparty faith and general confidence in the system, in other words, a grand con game in which the central bank is tasked with making sure the con works as planned when confidnce gets “a little low.”

One can not debate, however, that a bank had become anything but a pure Ponzi scheme – in this case, a piggybank whose funds were embezzled by its owner as described previously in “Fourth Largest Bulgarian Bank Seized After Bank Run: “Let’s Not Tear Down Our House” Central Banker Begs” – when a token review, only upon its faillure, reveals that 87% of its loans were invalid!

From Bloomberg:


And more:

Audit report of Bulgaria’s Corporate Commercial Bank, under central bank’s supervision since June 22, shows its assets of 6.66b lev as of Sept. 30 need to be written off by 4.22b lev, central bank in Sofia says on website.

The good news: the level of corruption, embezzlement and loan devastation in a country like Cyprus for example, where the entire banking sector had to be bailed out by Europe, was just a little less than what happened in Bulgaria’s fourth largest bank. Actually, it is unclear if that is good news.

The bad news: the Bulgarian central bank “regulator”, just like its peers across the continent, and the world, had no idea what the reality of the balance sheet was until the owner vaporized, as did nearly 90% of the bank’s funds, to borrow a Corzinism.

But it’s ok: remember – all other central banks and regulators have full and unhindered visibility when it comes to the fraud and embezzlement across the other several thousands banks that comprise the European Union. Just like the Fed did when it supervised Goldman and JPM. The only problem is that just like then, so now, nobody dares to do anything, as revealing just how deep the rabbit hole of balance sheet devastation is, goes against the primary directive of every central bank around the globe: preserving faith and confidence in the global fractional reserve banking con game.

As for all those innocent depositors in Bulgaria’s Corpbank who believed the Ponzi and con game would last indefinitely: our condolences: you most likely won’t ever see a dime of your money, even on the deposits that were supposedly “insured.”

1 thought on “Peak Ponzi: Only 13% Of Loans In Bulgaria’s Fourth Largest Bank Had Valid Collateral

  1. My question is this, Bulgaria joined the EU in 2007, and it appears to be another deadbeat state of the union. What are the economic responsibilities? The EU appears to be a bunch of states that joined together to become a large economic unit to compete with the growing world economy. But, it appears no due diligence was done regarding their economic standing. Enron accounting was used by more of the nations than not.
    The EU is made up of 28 states, 18 of them using the Euro, the other ten affiliated. From memory, I can recall weak states of Spain, Portugal, Italy, Greece, Ireland, Bulgaria, Belgium, Cyprus and Estonia………nine states, and I cannot recall all of them. Germany, their so-called leader, has debt to GDP of over 200%, the same with France. Along with countries with exposed empty coffers are others mired in debt.
    The EU was not well thought out, and I begin to wonder if it will survive. If not, the US goes with it, because the EU is keeping the dollar propped up.
    What a mess.

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