26.03.2016, 01:33
EBRD Supports Bulgarian Deposit Insurance Fund
OREANDA-NEWS. The European Bank for Reconstruction and Development (EBRD) is supporting Bulgaria's efforts to enhance the country's deposit insurance system, by providing a loan of EUR 300 million to the Bulgarian Deposit Insurance Fund (BDIF), an independent public institution and the sole deposit insurer in Bulgaria. The project is part of EBRD efforts to boost the resilience of the economies where it invests.
The EBRD loan will make a significant contribution to replenishing the Fund in the wake of a major bank failure in 2014 and will optimise the funding structure of BDIF. The loan will be conditional on the accomplishment of steps undertaken by BDIF in light of the new legislation frameworks for deposit insurance and bank recovery and resolution, implemented in mid-2015 to transpose requirements of the respective EU directives. The EBRD will thus contribute to greater financial independence and long-term sustainability of BDIF.
Reinforcing the deposit insurance system will increase confidence in the Bulgarian banking sector and support the efficient functioning of the financial market.
Matteo Patrone, EBRD Regional Director for Romania and Bulgaria, signed the agreement in Sofia today and said: "This loan is a landmark investment for the EBRD as it supports the development of the local banking market infrastructure. We are complementing the authorities' efforts to strengthen stability of the financial sector and this transaction is testimony to the EBRD's commitment to Bulgaria, its financial sector and savers in the country."
Lucyna Stanczak-Wuczynska, EBRD Director for EU Banks, added: "We are encouraged by the authorities' commitment to boosting the deposit insurance system. A stronger, more resilient system will contribute to a more stable banking sector in Bulgaria. We are proud to be part of this effort by providing financing to the BDIF and thereby aiding its further development."
The Bulgarian Deposit Insurance Fund was established in 1999. Its objective is to promote the stability of, and trust in, the country's financial system. BDIF protects bank deposits, contributes to the efficient execution of credit institutions' resolution and provides optimal protection of creditor interests in bank bankruptcy proceedings.
The loan to BDIF will be guaranteed by the government of Bulgaria. The EBRD's operations in the country are headed by Larisa Manastirli, who took up the Sofia-based position as Director for Bulgaria in December 2015 and also attended today's signing ceremony. The EBRD is one of the largest institutional investors in Bulgaria. To date, the Bank has invested over EUR 3.3 billion in more than 220 projects in the country.
The Bank's strategy in Bulgaria for the next four years focuses on strengthening financial sector intermediation through targeted investments and improved governance; enhancing competitiveness of companies, including small and medium-sized enterprises (SMEs), through improved efficiency, governance and innovation; and narrowing the infrastructure gap through commercialisation and supporting reforms.
The EBRD loan will make a significant contribution to replenishing the Fund in the wake of a major bank failure in 2014 and will optimise the funding structure of BDIF. The loan will be conditional on the accomplishment of steps undertaken by BDIF in light of the new legislation frameworks for deposit insurance and bank recovery and resolution, implemented in mid-2015 to transpose requirements of the respective EU directives. The EBRD will thus contribute to greater financial independence and long-term sustainability of BDIF.
Reinforcing the deposit insurance system will increase confidence in the Bulgarian banking sector and support the efficient functioning of the financial market.
Matteo Patrone, EBRD Regional Director for Romania and Bulgaria, signed the agreement in Sofia today and said: "This loan is a landmark investment for the EBRD as it supports the development of the local banking market infrastructure. We are complementing the authorities' efforts to strengthen stability of the financial sector and this transaction is testimony to the EBRD's commitment to Bulgaria, its financial sector and savers in the country."
Lucyna Stanczak-Wuczynska, EBRD Director for EU Banks, added: "We are encouraged by the authorities' commitment to boosting the deposit insurance system. A stronger, more resilient system will contribute to a more stable banking sector in Bulgaria. We are proud to be part of this effort by providing financing to the BDIF and thereby aiding its further development."
The Bulgarian Deposit Insurance Fund was established in 1999. Its objective is to promote the stability of, and trust in, the country's financial system. BDIF protects bank deposits, contributes to the efficient execution of credit institutions' resolution and provides optimal protection of creditor interests in bank bankruptcy proceedings.
The loan to BDIF will be guaranteed by the government of Bulgaria. The EBRD's operations in the country are headed by Larisa Manastirli, who took up the Sofia-based position as Director for Bulgaria in December 2015 and also attended today's signing ceremony. The EBRD is one of the largest institutional investors in Bulgaria. To date, the Bank has invested over EUR 3.3 billion in more than 220 projects in the country.
The Bank's strategy in Bulgaria for the next four years focuses on strengthening financial sector intermediation through targeted investments and improved governance; enhancing competitiveness of companies, including small and medium-sized enterprises (SMEs), through improved efficiency, governance and innovation; and narrowing the infrastructure gap through commercialisation and supporting reforms.
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