Page 88 - SE Outlook Regions 2023

former children's shoe factory. The €15mn investment should be
completed in September or October 2023.

In 2023 and 2024, Hippoland intends to open new stores mainly in retail
parks in a move away from locations in shopping malls.

3.3.2 Banks

Bulgarian banks remained stable amid the economic crisis caused by
the Russian war in Ukraine and posted solid profits. The country joined
the EU’s banking union in 2020, which was an additional guarantee for
the stability of the sector.

The aggregate net profit of Bulgarian commercial banks increased
40.9% y/y to BGN1.72bn (€879.4mn) in the first ten months of 2022,
according to Bulgarian National Bank (BNB) data.

Through October, the liquidity coverage ratio was 253.5% compared to
235.9% at the end of September. The liquidity buffer stood at
BGN38.4bn.

The net stable funding ratio (NSFR), applied since June 28, 2021, was
BGN158.9bn as of end-September, and the required stable funding (the
denominator of the NSFR) was BGN72.2bn. The net stable funding
ratio as of end-September amounted to 158.9%, way above the
minimum regulatory requirement of 100%.

Gross loans and advances in October increased by 4% y/y to
BGN96.7bn, mainly thanks to the claims on credit institutions, which
grew by 33.3% y/y to BGN12.1bn.

Compared to end-September, the banking system's gross loan portfolio
reported a growth of 0.8% y/y to BGN84.6bn. Claims on non-financial
corporations increased by 0.2% y/y, while those on households moved
up by 1.1% y/y. Loans to other financial corporations and to the general
governments sector increased by 2.9% y/y and 4.3% y/y, respectively.

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