Banking System Overview 2022
2022 WAS A RECORD YEAR FOR THE PROFITABILITY, LOANS AND DEPOSITS GROWTH AND PORTFOLIO QUALITY• 2022 was a record profitability year for the banking system as the net income came to BGN 2.1bn, +46.8% YoY (+BGN 663m) and 23.9% higher than the second best year (2018) in history. The biggest drivers were the 17% YoY increase of net interest income, the 15.2% YoY growth of net F&C income, the 48.1% YoY growth of gains on securities and the positive net other expenses in amount of BGN 27.8m vs negative BGN 71.2m in the comparable period. 12-m trailing ROE of the banking system continued improving for an eight consecutive quarter to 12.4% from 8.9% at end of 2021.
• Loans growth was registered across all segments with the highest once again being in the mortgage segment (+16.1% YoY), which continued driving the real estate market followed by consumer segment (+12.8% YoY) and corporate loans (+11.5% YoY). 24 banks increased their portfolios compared to a year earlier, while only the state owned Bulgarian Development Bank reduced it.
• The interest rates reached their historical bottom in the summer and started gradually, but still slowly to reverse the trend. For the BGN denominated new mortgage loans this was the year with the lowest weighted average interest rates of 2.54% (16bps lower YoY) while the BGN consumer loans registered 11bps higher average interest rate (8.16%) and corporate loans remained unchanged at average interest rate of 2.60%.
• The 90-days overdue ratio marked a new all-time low of 3.18% of gross loans at the end-2022 compared to 4.05% at end-2021. Overdue loans declined by BGN 338m on annual basis to BGN 2.7bn.
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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