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5.3.2 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 75% y/y to BGN1.3bn in the first ten months of 2023, according to Bulgarian National Bank (BNB) data.
Through October, the liquidity coverage ratio was 250.3% compared to 241.9% at the end of September. The liquidity buffer stood at BGN45bn.
The net stable funding ratio (NSFR), applied since June 28, 2021, was BGN156.1% as of end-September, with a minimum regulatory requirement of 100%. At end-September, the available stable funding (the numerator of the NSFR) was BGN128.9bn, and the required stable funding (the denominator of the NSFR) was BGN82.6bn.
Gross loans and advances in October stood at BGN108.8bn, increasing by 0.75 m/m. Claims on credit institutions decreased by 0.4% m/m to BGN13.4bn, while the gross loan portfolio grew by 0.8% m/m to BGN95.4bn. Loans to households increased by BGN525mn, those to non-financial corporations by BGN245mn and to other financial corporations by BGN82mn. Loans to the general government sector decreased by BGN49mn m/m.
The deposits in the banking system decreased by 0.9% m/m to BGN140.1bn. Deposits of households increased by 0.7% m/m, while those of credit institutions remained almost unchanged.
The banks' total assets increased to BGN164.2bn at the end of October from BGN151bn a year earlier.
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