SIF Moldova getting ready for provisions

SIF Moldova may lose approximately 130bn ROL of its profit by the end of the year, i.e. half the six-month earnings, which might impact on the dividends distributed to its nearly 9 million shareholders next year. Bankcoop’s liquidator may exact $3.5 million from the assets of the financial investment company, while another $0.5 million still under litigation with the liquidator of the bank may also add up. The former Private Ownership Fund Moldova secured a series of loans taken by a number of private companies from several banks. The companies failed to pay their debts so that the financial investment company, the successor of that Fund, has to repay the money itself. Bankcoop was officially declared bankrupt in late 2000, due to the failure to meet its current obligations. The SIF announced 3bn ROL had already been exacted from its bank accounts. SIF Moldova’s deputy chairman Sorin Turtoescu says the company’s 2003 profit will be hurt by the defeat suffered in court, in the lawsuits with the bank. “The amounts that may be exacted by Bankcoop’s liquidator were not included in our provisions. We make provisions at the end of every year and the amounts were still under litigation at the end of last year,” he explained. Which means that, whether the forced execution continues or not this year, the SIF will still have to register $3.5 million as additional expenses. ZF