C-Bank Governor: Bulgaria's Banking System Is Stable

The governor of the Bulgarian National Bank (BNB), Dimitar Radev, assured that the country's banking system is stable as a whole.

Radev noted that Bulgaria's commercial banks have high liquidity, but restoring the confidence to previous levels goes through stress tests and external assessment.

In his words, no external or political influence was exerted on the functioning of BNB, he said in an interview for private bTV station on Friday.

Radev admitted that there were weaknesses in the old system of banking supervision, which concentrated all rights and responsibilities into a single person.

The new system provides for shared rights and responsibilities between all members of the governing council.

It is foreseen that in the future the governing council will approve the internal rules of procedure regulating banking supervision.

Each quarter, the management will give to the governance of BNB an account of the problems its has established, the measures that have been taken and changes to the shareholder structure of banks.

An annual audit is also expected to establish whether there is compliance with the rules of banking supervision.

Radev added that the plan also foresees the establishment of a directorate “Restructuring of banks”.

According to him, the government budget for 2016 is balanced.

In his words, certain threats for the economy exist in the energy and transport sectors, due to the presence of so-called “quasi-deficits”, which could turn into real deficits.

Although reforms in these sectors are foreseen, their implementation remains unclear.

As regards the likely accession of Bulgaria to the euro zone, he said it was too early to give concrete dates as a lot of efforts were still needed in areas such as banking supervision and asset quality review.