Page 151 - Carte Falimentul BIR

BIR has hardly managed to overcome the difficult moment created by the TV
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show of May 17 1999 and to gradually recover the confidence of its customers.
Subsequently, in the second half of 1999, the deposits have risen again, especially
those for one-month and three-months, that led to increasing the volume of
payments by economic agents made through the bank.

In order to stimulate the recovery and reactivation of some credits, the BIR board,
based on the provisions of the Commercial Code and the Civil Code, issues on
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21 of July 1999, Circular no. 64. According to this, some branches assign debts,
especially those harder to recover, but all being secured by collateral under the
BIR mortgage, according to the Circular mentioned above.

At the same time, the BNR issued the Norms and the methodology of off-balance-
sheet debts with an enforceable form. By exceeding the legal provisions, before
the recovery ways for these guaranteed debts had been consumed, so before they
become actual losses, the BNR imposed, by these Norms, that such debts should
be recorded in the balance as "accounting losses".

A new regulation of the BNR also stipulates to includ on the cost of the specific
risk provisions, therefore affecting the financial results and deforming the
situation of the bank's net assets and patrimony.

The Government Emergency Ordinance No 186/1999, amending the Law No.
83/1998 on bankruptcy procedure, was issued on November 19 1999, under
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"emergency conditions" and with unimaginable "operability". The authors of this
Emergency Ordinance were the lawyers mentioned by Fănel Păvălache in his
statements, Arin Stănescu and Călin Zamfirescu, the managers of the new
company "Reconversion and Asset Recovery", specialized in reorganization and
judicial liquidation.

The main amendment to the Law no. 83/1998, by GEO no. 186/1999, consisted
in the text of Article 17, as it follows:

The Law no. 83/ 1998 art. 17 provided the following:

"As a banking supervisor, the BNR will be able to file a claim against the bank to
which special supervision and administration measures have been applied, that
have not led to the recovery of the bank, in a situation of inability to fully honor
the payments."

By the GEO no. 186/1999, the text of art. 17 was amended as it follows:

"As a banking supervisor, the BNR will be able to file a claim against the bank to
which special supervision or administration measures have been applied, that

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