European Central Bank to assess six Bulgarian banks

First Investment Bank AD

12/11/2018 19:29

SOFIA, Nov 12 (Reuters) - European Central Bank (ECB) will
conduct a comprehensive assessment of six Bulgarian banks as
part of the Balkan country's bid to join the European Union's
banking union, Bulgaria's central bank said on Monday.
    In July Bulgaria, who joined the EU in 2007, applied to join
the banking union, a step towards the Black Sea state's aim to
enter the "waiting room" for euro zone membership.
    The ECB, however, has resisted granting Bulgaria a fast
track to euro membership, saying its banks require tougher
supervision.
    "The comprehensive assessment is required as part of the
process of establishing close cooperation between the ECB and
the national competent authority of an EU Member State whose
currency is not the euro," the ECB said in a statement.
    The assessment of the three largest banks in terms of
assets, UniCredit Bulbank  CRDI.MI , DSK Bank, controlled by
Hungary's OTP  OTPP.BU  and United Bulgarian Bank, as well as
the largest three locally-owned First Investment Bank  5F4.BB ,
Central Cooperative Bank  4CF.BB  and Investbank will start in
November 2018 and results are expected in July 2019.
    The cut-off date for the exercise, comprising an asset
quality review and a stress test, will be Dec. 31 2018, the ECB
said. 
    The ECB said the assessment will be based on the
methodologies applied by its banking supervision in its regular
comprehensive assessments of banks. 
    Bulgaria had hoped to join the ERM-2 much earlier but under
pressure from its European Union peers accepted a series of
wide-ranging commitments that may prolong its waiting period.
    These include strengthening its banking sector and its
anti-money laundering systems.

 (Reporting by Angel Krasimirov; editing by David Evans)
 ((angel.krasimirov@thomsonreuters.com; +359 888 695 510))