The Romanian National Securities Commission forces Banca Transilvania to sell 25 million Euros worth of SIF1 stock

Last week, the Romanian National Securities Commission (CNVM) issued an ordinance forcing the Banca Transilvania (BT) group, made up of 30 shareholders with which the bank is presumed of acting in concert, to lower its holdings in SIF "Banat Crişana" (SIF1) from 17.28%, to 1%, as provided by law.

As a result, over the next three months the BT group could be forced to sell around 25 million Euros worth of SIF1 stock.

According to the CNVM, the group of shareholders acting in concert with "Banca Transilvania" includes the eponymous bank, the chairman of the bank"s Board of Directors, Horia Ciorcilă, his wife, Simona Ciorcilă, 12 other individuals, 13 companies and 3 investment funds.

Businessman Cătălin Chelu is in a similar situation. Together with the people that he is acting in concert with, he is required to lower his stake in SIF "Banat Crişana" from 1.77% to 1%, according to the ordinances of the CNVM. Chelu and the group that he is presumed of acting in concert with is also required to lower his stake in SIF Transilvania (symbol:SIF3), from 9.16% to 1%.

This is not the first time that the CNVM forces SIF shareholders to sell some of their stock. At the end of 2008, the CNVM forced the members of the group of Cătălin Chelu to lower their stakes in SIF Moldova (SIF2) and SIF Oltenia (SIF5) to 1%.

The total value of the shares that Banca Transilvania and the group of Chelu are required to sell in the next 90 days exceeds 40 million Euros, according to our calculations.

According to the ordinances of the CNVM, if the groups of shareholders do not lower their exposure to the SIFs, they will be sanctioned by the Commission according to the provisions of the legislation dealing with the capital market.