Bulgarian National Bank (BNB) deputy governor Roumen Simeonov dismissed media reports that First Investment Bank (FIB) had run into liquidity or solvency problems and was about to launch bankruptcy proceedings, the bank said in a statemetnt on its website on May 15.

The bank is not facing any penalties nor is in violation from regulations.

FIB chief executive Maya Georgieva also dismissed the rumours that the financial institution was on the brink of bankruptcy. Quite the opposite, she said, the bank has been courted by large financial institutions.

International financial heavyweights JP Morgan, Merrill Lynch and Morgan Stanley are arriving with a list of large investment projects for Bulgaria, among which are the purchase of a majority stake in local financial institutions, Georgieva said.

In the first quarter of 2008, FIB reported 15.07 million leva in net profit, a 49 per cent year-on-year increase. Assets of the financial institution as of end-March this year came in at 4.07 billion leva, down 3.2 per cent on the year.

The decrease is largely attributable to the decrease in the value of receivables from banks and financial institutions, investments at disposal for sale and financial assets kept to maturity. The bank is Bulgaria's sixth largest by assets.

The client base of the bank also rose by 0.5 per cent on the year to 2.78 billion leva. Cash and receivables from central banks increased by 18.5 per cent on the year to 721.21 million leva in the first quarter of 2008.