Banking System Overview 2021
2021 NET INCOME SURGED 73.8% YOY ON GROWTH OF NET F&C INCOME, LOWER CONTRIBUTIONS TO RESOLUTION FUNDS AND DEPOSIT GUARANTEE SCHEMES AND LOWER CREDIT PROVISIONS• The banking system net income growth came to 73.8% YoY as net F&C income was 19.5% higher, the contributions to resolution funds and deposit guarantee schemes were 48.1% lower and the credit provisions were down by -32.2% YoY. 12-m trailing ROE of the banking system continued improving for a fourth consecutive quarter to 8.9% after reaching a 6-year bottom of 5.5% at end of 2020.
• Gross loans of the banking system surged by 9.2% YoY as the growth accelerated for a fourth consecutive quarter. Loans growth was registered across all segments with the highest one in the mortgage segment (+15% YoY), followed by consumer segment (+11% YoY) and corporate loans (+5.9% YoY). The breakdown by banks reveals that 21 banks increased their portfolios compared to a year earlier, while 4 banks reduced them.
• Interest rates continued to decline in 2021. The BGN denominated new corporate loans had 31bps lower average interest rate (2.60%) compared to 2020, the BGN mortgage loans had 17bps lower average interest rate (2.71%) and the BGN consumer loans registered 12bps lower average interest rate (8.08%). The new EUR denominated loans registered declines for consumer (3.33%) and mortgage (3.24%) loans and an increase of corporate (2.42%) loans.
• The 90-days overdue ratio was down to its lowest reading ever (4.05% of gross loans) at the end-2021 compared to 4.78% at end-2020 despite the expiration of the moratorium on bank payments at end-March. The payments on 11.8% of the gross loan portfolio were still deferred under the moratorium terms.
First Financial Brokerage House (FFBH) is a leading non-banking financial institution on the Bulgarian capital market. Founded in 1991, FFBH offers the complete spectrum of investment banking services spanning corporate finance, privatisation advisory, mergers and acquisitions, financial consulting, brokerage services, research & analysis and asset management.
FFBH provides its services mainly to major international banks and corporations seeking investment in Bulgaria. FFBH is not only local contractor and partner to its clients but also an information source and provider for all major news and events in the economic and political life of the country.
We are the main contact point for the large majority of foreign and local institutional investors in the Bulgarian equity market. FFBH is providing access to the Bulgarian Stock Exchange by either its highly experienced sales trading desk or by order routing across the Bloomberg network.
Additionally, FFBH is offering a range of tools, specifically tailored for the retail investor. Both domestic and international markets are only a click away, via electronic trading solutions. As a major advantage, our customers are able to benefit from the broad range of Analysis & Research products with premium quality, provided by our team of dedicated analysts.
Clients of our research products are most of the largest foreign and local institutional investors looking for opportunities in Bulgaria. More than 100 investment banks, investment funds and other institutional investors use our Equity research and Economic review on a regular basis. FFBH’s Morning Bulletin and Weekly Bulletin reach more than 300 clients over different countries and continents.
Our major Research and Analysis Services include:
- Semi-Annual Outlook of the Bulgarian economy and the domestic capital markets;
- Equity analyses of the biggest and/or most liquid companies listed on Bulgarian Stock Exchange - Sofia;
- Quarterly Bulgarian Real Estate sector and REITs overview;
- Quarterly Bulgarian Banking System overview;
- Quarterly macroeconomic overeview, with details on the major economic sectors, commentaries, and statistical indicators;
- Daily and Weekly bulletins, including an overview of the capital markets and the most important macroeconomic & corporate events.
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