Bulgaria is a country in southeastern Europe, a member of the European Union since 2007.
Agriculture and tourism have been important components of Bulgarian economy. In recent years low salaries and low corporate income tax rates, attracted foreign companies into technological and research sector. However, factors like corruption, a weak judiciary, and organized crime impede the country's investment climate and economic growth.
Bulgarian banking system is characterized by relatively high concentration: competition between the major banks is making it difficult for other banks to compete. Another feature of the Bulgarian banking system is a prominent share of foreign capital.
1 EUR = 1.9558 BGN (2017-10-19)
During the last 11 years EURBGN exchange rate was within the range 1.9558 - 1.9558, reaching its maximum in Jul 2016 and falling to its minimum in Jul 2016.
|Nominal GDP (2016)||Nominal GDP per Capita (2016)||Real GDP Growth (2016)|
|48.1 bln EUR (+0.08%)||6 800 EUR (+0.07%)||3.9 % (2015: 3.0 %)|
According to Eurostat, nominal GDP of Bulgaria in 2016 was 48.1 bln EUR.
Bulgaria outperforms the European Union in terms of real GDP growth with the average annual differential coming to 0.9% over the past 10 years (2006 - 2016). In 2016 real GDP growth was 3.9% which was above the Euro Area average (1.8%) and above the European Union average (1.9%). Real GDP growth in 2017 - 2022 are IMF's estimates.
In 2016, nominal GDP per capita in Bulgaria was 6 800 EUR.
Bulgaria has a below-average level of wealth in terms of per-capita GDP at purchasing power parity (PPP); this economic welfare indicator has, on average, fell behind that of the European Union by -43.6% over the past 10 years (2006 - 2016). GDP per capita at PPP in 2017 - 2022 are IMF's estimates.
|CPI, MoM (Sep 2017)||CPI, YoY (Sep 2017)||CPI, Year Average (2016)|
|-0.2 % (Aug 2017: 0.2 %)||1.3 % (Aug 2017: 0.7 %)||-1.3 % (2015: -1.1 %)|
According to Eurostat, inflation rate in Bulgaria in 2016 expressed as annual percentages of average consumer prices was -1.3% which was below the Euro Area average (0.2%) and below the European Union average (0.3%). Inflation rates in 2017 - 2022 are IMF's estimates.
|Unemployment Rate (2016)|
|7.6 % (2015: 9.2 %)|
|Government Bond Yield (Sep 2017)|
|1.66 % (Aug 2017: 1.70 %)|
|BBB- (good credit quality), outlook stable||Baa2 (lower medium grade), outlook stable|
Double Taxation Agreement (DTA) is an agreement between two or more countries for the avoidance of double taxation.
Bulgaria signed DTAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):
There are 3 ways for jusrisdictions to exchange information on tax matters:
Spontaneous exchange of information is provision of information that is forseeably relevant to another party without a request being previously sent.
Tax Information Exchange Agreements (TIEAs) enable exchange of information on request relating to a specific tax investigation, either criminal or civil.
Automatic information exchange allows jurisdictions to exchange information automatically, without having a specific tax investigation.
Bulgaria signed the automatic information exchange agreement on 29 October 2015 and committed to start the automatic information exchange in September 2017.
Foreign Account Tax Compliance Act (FATCA) which became law in the United States in March 2010, focuses on reporting made by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest. The FATCA-reporting is facilitated by Intergovernmental Agreements (IGAs).
|FATCA Status in Bulgaria|
|IGA in effect since 05 December 2014, Model 1|
Bulgaria has FATCA agreement with the U.S. in effect since 05 December 2014 (Intergovernmental Agreement Model 1). Financial institutions operating in Bulgaria are required to identify U.S. taxpayers by January 1, 2017 and to report the information for 2017 and the subsequent years. The agreement is non-reciprocal: Bulgarian financial accounts hold in U.S. financial institutions will not be reported to Bulgarian authorities.
|Financial Market Development|
|4.1 (max 7.0), 58th out of 138 countries|
|4.3 (max 7.0), 96th out of 138 countries|
According to World Economic Forum's Global Competitiveness Report 2017-2018, financial market development in Bulgaria is scored 4.1 out of maximum 7.0 and ranked 58th out of 138 analysed economies. Soundness of banks is scored 4.3 bringing Bulgaria into the 96th place, trustworthiness and confidence of financial market is scored 4.6 (47th place).
|Maximum Protected Amount|
|100 000 EUR|
Deposit Guarantee Schemes compensate certain deposits held by depositors of a bank that becomes unable to meet its obligations.
From a depositor's point of view it is important to know:
All these details about deposit guarantee scheme in Bulgaria are summarised in Table 1.
|Scheme Participants||all credit institutions operating in Bulgaria, branches of non-EU banks, branches of Bulgarian banks abroad|
|Scheme Exemptions||branches of EU-banks (covered by their home countries)|
|Eligible Depositors||natural persons, legal entities|
|Covered Accounts||all funds on a bank account (term deposit, demand deposit, savings or current account, etc)|
|Maximum Protected Amount||100 000 EUR|
|Paid In Currency||BGN|
Table 1. Deposit guarantee scheme in Bulgaria.
Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.
|Local Currency (Bulgarian lev)||Foreign Currency|
|A3 (upper medium grade)||Baa2 (lower medium grade)|
Local currency (Bulgarian lev) deposit ceiling for Bulgaria is set to A3 (upper medium grade), foreign currency deposit ceiling is Baa2 (lower medium grade).
|Average Deposit Rate (Aug 2017, BGN)|
|0.16 % (unchanged)|
|Number of Banks|
|Consolidated Assets (2016)|
|48 034.48 mln EUR (+5.59%)|
|Recent Changes (2016)|
|new banks: 0, closed banks: 0|
Currently there are 29 credit institutions operating in Bulgaria.
In 2016 consolidated banking assets in Bulgaria were 48 034.48 mln EUR. The consolidated banking assets' evolution is shown at Chart 8 below.
Recent structural changes (2013 - 2016) of the banking sector of Bulgaria are summarised in Table 2.
|Number of Opened Banks||0||0||0||0|
|Number of Closed Banks||0||2||0||0|
Table 2. Recent structural changes in the banking sector of Bulgaria.
All the credit institutions operating in Bulgaria can be classified into several categories. Table 3 summarises the number of banks in each category.
|Category||Number of Banks|
|Branches of foreign banks||6|
There are 6 branches of foreign banks from 6 different countries in Bulgaria. Table 4 shows the number of branches grouped by the country of origin.
|Country of Origin||Number of Branches|
|1||UniCredit Bulbank AD|
|2||DSK Bank EAD|
|3||United Bulgarian Bank AD|
|4||Raiffeisenbank (Bulgaria) EAD|
|5||First Investment Bank AD|
|6||Eurobank Bulgaria AD|
|7||Corporate Commercial Bank|