BNB Governor: Economic Crisis in Bulgaria May Get Worse

The Governor of the Bulgarian National Bank (BNB) Dimitar Radev warned of a possible deterioration of the economic crisis. The warning made on the eve of Banker's Day - December 6is published in the traditional bulletin released by the Association of Commercial Banks.

The second wave of Covid-19 can implement the scenario for exacerbating the economic crisis and hence the deterioration of the loan portfolios of the banks, writes BNB Governor Dimitar Radev. He is adamant that banks must prepare to operate in the face of triggered capital buffers and have a clear plan for their recovery after the crisis.

Radev underlines the good position in which the Bulgarian banking sector has entered the crisis, as well as the timely supervisory measures that will ensure transition during this difficult period.

The Governor also touches on the topic of a potential new moratorium on loans, which will allow a total of 9 months - i.e. the new term and the already existing deadlines of the first moratorium, to have a temporary partial or total suspension of the servicing of the loans.

There may then be a rise in non-serviced loans, the Governor also warns.

For his part, the Chairman of the Banking Association Petar Andronov, who also extends his greetings to the professional community, announces that as soon as possible the banks will be ready with the order for the new deferral of liabilities.