Banking System Overview H1'2021
H1’21 PROFITABILITY IMPROVES ON INCOME GROWTH AND LOWER COST; NPE’S DECLINE FURTHER• Bulgarian banking system registered 27.8% YoY net income growth in H1’21 to BGN 658.6m on growth of net interest income, net F&C income, positive FX effect, lower contribution to resolution funds and deposit guarantee schemes and lower credit provisioning. 12-m trailing ROE of the banking system slightly improved to 6.2% from 5.8% at Q1’21 end and 5.5% at end-2020.
• Annual growth of gross loans came to 6.8% YoY (+BGN 4.5bn) as of end-June with corporate loans up by 4.6% YoY (+BGN 1.7bn), mortgage loans surging 12.4% YoY (+BGN 1.6bn) and consumer loans increasing 8.4% YoY (+BGN 1.1bn).
• The interest rates remained on downward trend in H1’21. The BGN denominated new corporate loans had 31bps lower average interest rate (2.65%) compared to H1’20, the BGN mortgage loans had 15bps lower average interest rate (2.76%) and the BGN consumer loans registered 32bps lower average interest rate (7.80%).
• The statistics for 90-days overdue ratio revealed a new record low level of 4.58% of gross loans at the end-June compared to 4.78% at end-2020 despite the expiration of the moratorium on bank payments at end-March.
• The total non-performing exposures declined by BGN 503m YoY and by BGN 198m YtD to reach BGN 5.5bn at end-June while the NPE’s ratio was down to 7.7% of gross loans (excl. loans to credit institutions) vs 8.22% at end-2020. The payments on 14.3% 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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