Bulgaria—cross border banking and finance guide
Produced in partnership with Schoenherr
Bulgaria—cross border banking and finance guide

The following Banking & Finance guidance note Produced in partnership with Schoenherr provides comprehensive and up to date legal information covering:

  • Bulgaria—cross border banking and finance guide
  • Loan market and developments
  • Lending
  • Security and guarantees
  • Enforcement
  • Intercreditor issues
  • Governing law and disputes

Loan market and developments

Please provide a brief overview of the current state of the loan markets in your jurisdiction and any significant recent market developments

According to market analysis by one of the Big Four consulting firms, an increase of 2 to 3% in the demand for financial resources in Bulgaria is envisaged in 2017. This forecast is in harmony with the constant gradual growth in credit activities since 2013. In the retail sector, mortgage loans are dominant and their number will keep increasing due to improved incomes in the population and to low interest rates. The share of consumer loans is also significant, however in this sector the lead lenders are the non-banking financial institutions. As for corporate loans, a slight rise of 1 to 2% is also anticipated in 2017, after a gradual and consistent decrease in their share over the past two years due to the deleverage activities of the banks. Interest rates for corporate loans mark a record low of 3.73% for the first months of 2017, which will undoubtedly keep the popularity of loan financing high for business when compared to equity financing.

With respect to non-performing and restructured loans, in the middle of 2017 the share was 20.9% which was its lowest level since May 2011. This is a sign of the