Sofia, 22 November 1996 (RFE/RL) - The Bulgarian National Bank yesterday reacted to a nationwide rush for hard currency by adjusting its recommended exchange rate by about 20 percent.
The move marks the largest single-day adjustment to the central bank exchange rate in Bulgarian history -- from 287 lev per dollar yesterday to about 344 lev today.
Meanwhile, traders in Sofia say they would be glad to buy U.S. dollars for a mere 344 lev. Many private exchange offices in Sofia simply refused to sell dollars at all today. Long queues formed at change bureaux that offered dollars at a rate of 405 lev. Our correspondent in Sofia says fist-fights were breaking out as people jockeyed for position in the queues.
Confidence in Bulgarian financial institutions has been shattered by the collapse of 14 private and state-owned commercial banks since the beginning of the year. A recent rush to withdraw deposits has been fueled by fears about the stability of the State Savings Bank, DSK. With government guarantees for all depositors, DSK has long been considered the least risky institution for Bulgarian savers.