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PRESS RELEASE

25 July 2019

The Governing Council of the Bulgarian National Bank (BNB) during its regular meeting today discussed the results of the comprehensive assessment (CA), conducted by the European Central Bank (ECB) in the context of Bulgaria’s request for establishing close cooperation between the ECB and the BNB. The CA comprised an asset quality review (AQR) and a stress test of six Bulgarian banks. The ECB is expected to publish the detailed results tomorrow. The position of the Governing Council regarding the implications from the CA results on the BNB supervisory policy is as follows:

1. The CA results are consistent, taking into consideration the time lag and the changes in the methodology to incorporate the effect of the accounting standard IFRS 9, with the results from the asset quality review and stress test conducted by the BNB in 2016 and the subsequent findings of the banking supervision. The results reveal the resilience of the Bulgarian banking sector overall.

2. The BNB, therefore, endorses the CA results. Follow-up actions related to further strengthening of the capital position will be conducted in strict compliance with the BNB mandate and the relevant regulatory framework.

3. On the basis of the AQR results and post reference date developments, the BNB undertook an estimate as per the prudential requirements of Art. 92 of Regulation (EU) No 575/2013 of the European Parliament and of the Council. The results from the BNB estimate confirm that each of the six banks meets the prudential requirements of the above mentioned Regulation.

The BNB Governing Council notes the excellent cooperation between the BNB and the ECB in the CA process, which will continue in the process towards establishing close cooperation.