Download BULGARIA: ECONOMIC AND MARKET ANALYSES

BULGARIA:
ECONOMIC AND
MARKET ANALYSES
February, 2010
Bulgaria: Key Indicators
2008
2009
2010e
GDP growth (%) y/y
6.0%
-5.1%
0.0%
Inflation eoy (%)
7.8%
0.6%
2.0%
Unemployment
rate (%)
6.31%
9.10%
12.0%
In the period January 2010, the current account deficit was EUR 242.3 mn. (0.7% of GDP),
against a deficit of EUR 552.5 mn. (1.6% of GDP) for January 2009
As of end-January 2010 gross external debt1 was EUR 37,291.6 mn. (107.5% of GDP2)
and decreased by EUR 414.2 mn. against the end of 2009
The stock of foreign reserves declined to EUR 11.59bn as beginning of March
The GDP for 20009 amounted to BGN 66 256,2 mn. in current prices
Current
Account/GDP (%)
Trade balance
EUR mn
FDI EUR mn.
Government Debt/GDP (%)
-22.5%
-8.6%
-10.0%
-8 832
-4 084
-5 050
5 430
2 845
3 000
16.1%
16.0%
15.0%
3.0%
-0.8%
0.00%
In March the business climate indicator fell down to 5.6%. This is the lowest level in the
index history since March 2003
The inflation since the begging of the year (February 2010 compare to 2009) is 1.2%
Producer price index on domestic market in January 2010 rose 1.8% compared to the
same month of 2009
The Industrial Turnover Index decreased by 9.8% compared to December 2008
Budget Surplus/ GDP(%)
In January 2010 according to the preliminary data, the turnover in the trade sector decreased by 19.0% compared to the same month of the previous year
10 year bond yield
(avarage)
5.38%
7.25%
Source: BNB,
estimations UBB, MF forecasts
7.00%
The unemployment rate in February 2010 is 10.26%
The fiscal reserve amounted to BGN 7 672.9 mn.
In February 2010, the annual growth rate of broad money (monetary aggregate M3) was
8.1% compared to 5.5% in January 2010
Net domestic assets reached BGN 47.987 bn. at the end of February 2010, which is a 6.8%
increase compared to the same month of 2009
At the end of January, the total assets in the banking system were BGN 70.2 bn.
INITED BULGARIAN BANK
CHIEF ECONOMIST DEPARTMENT
5 SVETA SOFIA STR. , SOFIA 1040
Chief analyst:
Gergana Kosturska
тел.:
(359 2) 811 29 82
e-mail: [email protected]
The total volume of the BSE in February was BGN 25 498 mn.
In February the average property prices in the seventh biggest cities in Bulgaria rose with
1.2% average
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
1
I.EXTERNAL SECTOR
1.Balance of payments
In the period January 2010, the current account deficit was EUR 242.3 mn. (0.7% of GDP),
against a deficit of EUR 552.5 mn. (1.6% of GDP) for January 2009
Balance of payments
Source: BNB
400.0
0.0
-400.0
-800.0
CA
01/10
10/10
07/09
04/09
01/09
10/08
07/08
04/08
01/08
-1200.0
Net FDI
In the period January 2010, the current account deficit was EUR 242.3 mn. (0.7% of GDP),
against a deficit of EUR 552.5 mn. (1.6% of GDP) for January 2009. Main factors for the current
account deficit decrease were the lower (by EUR 170.5 mn.) trade deficit and the lower (by EUR
102.3 mn.) income deficit. The trade deficit in January 2010 amounted to EUR 173.7 mn. (0.5%
of GDP), compared to a deficit of EUR 344.2 mn. (1% of GDP) for January 2009. Exports (FOB)
amounted to EUR 917 mn. against EUR 812.9 mn. for January 2009, increasing by 12.8% yoy
against a decrease yoy of 27% for January 2009. Imports (FOB) amounted to EUR 1,090.7 mn.,
against EUR 1,157.1 mn. for the January period in 2009, decreasing by 5.7% yoy against a
decrease yoy of 32.9% for January 2009. The balance on the Services item was negative,
amounting to EUR 2.3 mn., against a negative balance amounting to EUR 27.5 mn. (0.1% of
GDP) for January 2009. Income (net) item was negative amounting to EUR 116 mn. compared
to a negative item of EUR 218.3 mn. for January 2009. Net Current transfers amounted to EUR
49.8 mn. (0.1% of GDP) against EUR 37.5 mn. (0.1% of GDP) for January 2009. The Capital
account balance was negative amounting to EUR 6.6 mn., compared to a positive balance of
EUR 151.1 mn. for January 2009. The Financial account balance was negative amounting to
EUR 208.9 mn., compared to a negative balance of EUR 527.4 mn. for January 2009. Foreign
direct investment abroad was EUR 1.9 mn. against EUR 7.9 mn. for January 2009. Foreign
direct investment in Bulgaria4,5 was EUR 52.9 mn. (0.2% of GDP) against EUR 391.7 mn.
(1.2% of GDP) for January 2009. The direct investment covered 21.8% of the current account
deficit against 70.9% for January 2009. Portfolio investment – assets decreased by EUR 12.9
mn., compared to an increase of EUR 319.6 mn. for January 2009. Portfolio investment – liabilities increased by EUR 4.2 mn. In the period January 2009, the liabilities decreased by EUR 50.3
mn. Other investment – assets decreased by EUR 205.5 mn., compared to an increase of EUR
248.2 mn. for January 2009. Other investment – liabilities decreased by EUR 480.6 mn. against
a decrease of EUR 311.6 mn. for January 2009. The item Net errors and omissions was positive, amounting to EUR 34.9 mn. For January 2009 the item was positive amounting to EUR
194.1 mn. The Overall balance was negative, amounting to EUR 422.9 mn. compared to a
negative overall balance of EUR 734.7 mn. for January 2009. In the period January 2010 the
BNB reserve assets6 decreased by EUR 422.9 mn.
2..External debt
As of end-January 2010 gross external debt was EUR 37,291.6 mn. (107.5% of GDP) and
decreased by EUR 414.2 mn. against the end of 2009
Gross External Debt, EUR bn
Source:BNB
50
40
30
20
10
0
01/08
07/08
Public
01/09
07/09
Private
01/10
As of end-January 2010 gross external debt was EUR 37,291.6 mn. (107.5% of GDP) and decreased by EUR 414.2 mn. against the end of 2009 (EUR 37,705.8 mn., 111.3% of GDP). The
highest debt decrease was the decrease (by EUR 486.2 mn., 5.8%) of Banks’ liabilities. Compared to end-January 2009 (EUR 37,271.1 mn.) the debt increased by EUR 20.5 mn. As of endJanuary 2010 long-term liabilities amounted to EUR 24,856.7 mn. (66.7% of total debt), and
short-term liabilities came to EUR 12,434.9 mn. (33.3% of total debt). General Government’s
external debt amounted to EUR 2,851.6 mn.3 (8.2 % of GDP) as of end-January 2010, increasing by EUR 50.3 mn. (1.8%) against the end of 2009. Compared to end-January 2009 (EUR
2,556.5 mn.) the sector’s debt increased by EUR 295.2 mn. increasing by EUR 209.6 mn.
(8.1%) against the end of 2008. Compared to end November 2009 (EUR 2,796.5 mn.) the sector’s debt increased by EUR 8.8 mn. Banks’ external debt amounted to EUR 8,375.6 mn. (24.7%
of GDP) decreasing by EUR 701.5 mn. (7.7%) against the end of 2008. Compared to endNovember 2009 (EUR 8,077.2 mn.) the sector’s debt increased by EUR 298.4 mn. Other Sectors’ debt4 was EUR 12,083.4 mn., increasing by EUR 105.3 mn. (0.9%) relative to the end of
2008. Compared to end-November 2009 (EUR 12,024.3 mn.) the sector’s debt increased by
EUR 59.1 mn. As of end December 2009 the stock of Intercompany Lending4 was EUR 14,336
mn., increasing by EUR 1,013.1 mn. (7.6%) against the end of 2008. Compared to endNovember 2009 (EUR 14,237.2 mn.) the sector’s debt increased by EUR 98.8 mn. As of end
December 2009 88.6% of the gross external debt was denominated in EUR and 6.5% in USD.
Compared to December 2008 the share of the EUR denominated debt increased by 2.8 p.p. and
that of the USD denominated debt decreased by 0.1 p.p. In January – December 2009, gross
external debt service was EUR 6,791.4 mn. (20.1% of GDP) against EUR 7,047.5 mn. (20.7% of
GDP) for the same period in 2008. In January – December 2009, loans and deposits received
from non-residents came to EUR 6,445.9 mn. (19% of GDP) compared to EUR 12,934.9 mn.
(37.9% of GDP) for the same period in 2008. Newly disbursed Intercompany Lending amounted
to EUR 2,922.5 mn. (45.3%), Banks received EUR 1,698.1 mn. (26.3%), Other Sectors – EUR
1,292.4 mn. (20%) and General Government – EUR 533 mn. (8.3%). As of end-December 2009,
net external debt was EUR 19,418.2 mn. (57.4% of GDP) and increased by EUR 65.3 mn.
(0.3%) against the end of 2008 (EUR 19,352.9 mn., 56.7% of GDP).
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
2
3.Foreign reserves
Foreign Reserves
Source: BNB
20 000
The stock of foreign reserves declined to EUR 11.59bn as the beginning of March
The stock of foreign reserves declined by 5% w/w to EUR 11.59bn as of March 5. The holdings of the government and commercial banks at the central bank fell by 5.7% and 16.1%
respectively. Other depositors also contributed negatively but their share is much smaller.
The foreign reserves have fallen by 10.3% since the beginning of the year. The ratio of
foreign reserves to short-term debt deteriorated to 99.3% as of end- December from
101.9% as of end-November.
15 000
10 000
5 000
02/10
09/09
04/09
11/08
06/08
01/08
0
II. REAL SECTOR
1.Gross Domestic Product
The GDP for 20009 amounted to BGN 66 256,2 mn. in current prices
GDP 2007 - Q4 2009,
preliminary data
13.0
8.0
Q3/09
Q1/09
Q3/08
Q1/08
Q3/07
-2.0
Q1/07
%
3.0
-7.0
The GDP for 20009 amounted to BGN 66 256,2 mn. in current prices which in EUR is
33 876,3 mn. The GDP per capita is EUR 4 466.1. In real value the GDP decrease with
5.0% compare to 2008. According the preliminary data the produced GDP in the Q4 of 2009
is BGN 17 917.2 mn. (EUR 9 160.9) in current prices. The GDP per capita for Q4 of 2009 is
BGN 2 366.9 (EUR 1 210.2). In USD and exchange rate BGN 1.323222 for a USD the GDP
mounted to USD 13 540.6 mn. and USD 1 788,7 respectively. In EUR the same. Compare
to Q4 of 2008 the real GDP drop is 5.9%. The branches Gross domestic value mounted to
BGN 14 830,1 mn. in current prices. Recalculated in comparable prices the added value
decrease with 5.3% compare to the same period previous year. The industrial sector decrease its relative share in the economy added value compare to Q 4 of 2008 and reach up
to 28.0%in the Q4 of 2009. The relative share in the added value, realized by the activities
in the services sector is 68.3%, which is with 1.7% more compare to the same period previous year. The relative shere in the Agriculture sector decrease with 0.8% and reach 3.7% in
Q4 of 2009. The GDP drop in the Q4 of 2009 is mainly due to the added value in the agriculture sector, which is 11.3% less compare to Q4 of 2008. Compare to the same period of
2008 the real GDOP drop in the services sector is 3.9%, while the industrial sector gross
added value decrease with 7.5% real. For the population individual consumption in Q4 of
2009 the expenditures amounted to 72.7% of the produced GDP. The real decrease of the
indicator is 8.7% compare to the same quarter of 2008. The investments physical volume
index is 64.6% and determines the main share of the category up to 24.7% of the produced
GDP. The import of services and goods exceed with BGN 1 475.8 mn. the export. For this
period the external trade balance decreased with 10% average. The export of services and
goods decreased with 0.8%, while the import is 20% compare to the same period of 2008.
2.Business climate
In March the business climate indicator fell down to 5.6%. This is the lowest level in
the indеx history since March 2003
Business climate for the period
01/09-03/10
Source:NSI
24
20
16
12
8
01/10
10/09
07/09
04/09
01/09
4
In March 2010 the NSI business surveys register a decrease in the level of the total business climate indicator3 of 0.9 % in comparison with February. The indicator decreases in all
of the sectors with the exception of the service sector, as the highest drop is recorded in
retail trade. Industry. The composite indicator “business climate in industry” in March decreases by 1.6 % in comparison with the previous month. This is due to the worsened managers’ assessments of the present business situation of industrial enterprises. There is a
slightly increased optimism in the expectations about the business situation of enterprises
over the next 6 months and about the production activity over the next 3 months, which is
accompanied however by expectations about a reduction of employment in the sector. The
business inquiry also registers a certain slowing down of the production activity drop. Construction. The composite indicator of business climate in construction decreases by 0.4 % in
comparison with the previous month due to the lower assessments of the construction entrepreneurs about the present business situation in enterprises. Over the last month the
production assurance with orders has been worsened and the construction activity has
been reduced , as the managers’ expectations about the construction activity over the next
3 months are more optimistic . The last business inquiry reports on a certain decrease of
the number of clients with delay in payments. With regard to the personnel a decrease is
expected, but with a lower rate in comparison with the previous months. Retail trade. In
March the composite indicator “business climate in retail trade” decreases by 3.2 % in comparison with the previous month due to the worsened managers’ assessments and expectations about the business situation in enterprises.
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
3
At the same time the expectations about the sales and the orders placed with suppliers over
the next 3 months are also more pessimistic. In March the composite indicator of business
climate in service sector increases by 2.2 %. This is due to the improved managers’ assessments and expectations about the business situation in enterprises. The present demand
for services is assessed unfavorably, but the expectations about the next 3 months are
optimistic (the balance indicator goes up by 8.1 %). The managers also expect an increase
of the employment in the sector over the next 3 months.
3.Inflation
The inflation since the begging of the year (February 2010 compare to 2009) is 1.2%
The consumer price index (CPI) in February 2010 compare to January 2010 is 100.6%,
which means that 0.6%. The inflation since the beginning of the year (February 2010 compare to 2009) is 1.2%, while the annual inflation in February 2010 compare to February
Inflation y/y
2009 is 0.9%. The average annual inflation for the period March 2009 – February 2010
Source: NSI
compare to the period March 2008 – February 2009 is 1.8%. In February 2010, compare to
5%
the previous month the goods’ and services’ prices had changed as follows: increase in
beverages and food products with 1.5%; alcohol and tobacco with 1.2%; apartments (rents,
repair, maintenance), water, electricity, gas and other fuels with 0.1%; transport – with
0.2%; free time and entertainment with 0.8%; education with 0.2%. Decrease was regis0%
tered in: clothes and shoes – with 1.5%; furniture, house utilities with 0.1%; healthcare –
01/07 07/07 01/08 07/08 01/09 07/09 01/10 with 0.4%. The prices stay the same in the communication, restaurants and hotels. The
harmonized index of consumer prices (HICP) for February 2010 compare to January 2010
is 100.3%, which means that the inflation is 0.3%. The inflation since the begging of the
-5%
year is (February 2010 compare to December 2009) is 0.9%, while the annual inflation for
February 2010 compare to February 2009 is 1.7%. The average annual inflation for the
CPI, y/y
period March 2008 – February 2009 is 1.8%. The small consumer basket index for February 2010 compare to January 2010 is 101.0%, while since the begging of the year
(February 2010 compare to December 2009) is 101.7%. In February the prices of services
and goods from the small consumer basket for the poorest 20% of the households had
changed as follows: food products – increase with 1.8%; non-food products decrease with
0.1%; services – the price stays the same as previous month.
4.Producer price index
Producer price index on domestic market in January 2010 rose 1.8% compared to the
same month of 2009
Producer Price Index y/y
Source:NSI
20%
15%
10%
5%
0%
-5%
01/08
-10%
-15%
07/08
01/09
07/09
PPI, y/y
01/10
Producer price index on domestic market in January 2010 rose 1.2% compared to the previous month. The domestic prices increased in the mining and quarrying industry by 2.2%, in
the manufacturing by 1.1% and in the electricity, gas, steam and air conditioning supply by
1.2%. In the manufacturing the more significant price increase comparing to the previous
month were seen in the manufacture of tobacco products by 21.1%, in the manufacture of
basic metals by 3.1%, in the repair and installation of machinery and equipment by 2.7%.
The prices decreased in the manufacture of fabricated metal products, except machinery
and equipment by 1.2% and in the manufacture of chemicals and chemical products by
1.1%. Producer price index on domestic market in January 2010 rose 1.8% compared to
the same month of 2009. The domestic prices increased in the mining and quarrying industry by 28.3% and in the manufacturing by 4.1% while in the electricity, gas, steam and air
conditioning supply the prices fell by 7.1%. In the manufacturing compared to the same
month of 2009, the prices increase was registered in the manufacture of basic metals by
17.6%, in the manufacture of tobacco products by 17.3%, in the manufacture of beverages
by 6.5%. The price decrease was seen in the manufacture of wood and of products of
wood, except furniture by 9.9%, in the manufacture of other non-metallic mineral products
by 4.7%, in the manufacture of food products by 3.9%.Total producer price index in industry
in January 2010 increased by 1.8% compared to December 2009. The higher prices were
registered in the mining and quarrying industry by 2.2%, in the manufacturing by 2.0% and
in the electricity, gas, steam and air conditioning supply 1.0%. In the manufacturing, more
significant price increase was seen in the manufacture of tobacco products by 18.0%, in the
manufacture of basic metals by 6.2%, in the manufacture of other transport equipment and
in the repair and installation of machinery and equipment by 2.3%. Total producer price
index in January 2010 increased by 3.0% comparing to the same month of 2009. In the
manufacturing, the prices rose 6.6% as compared to January 2009. More significant price
increases were seen in the manufacture of basic metals by 29.5%, in the manufacture of
tobacco products by 13.5% and in the manufacture of chemicals and chemical products by
12.0%, while the producer prices decreased in the manufacture of wood and of products of
wood, except furniture by 8.8%, in the manufacture of other non-metallic mineral products
by 4.3% and in the manufacture of food products by 4.2%.
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
4
5..Industrial turnover index
Industrial Turnover, % y/y
Source: NSI
The Industrial Turnover Index decreased by 9.8% compared to December 2008
80%
40%
0%
-40%
01/10
09/09
05/09
01/09
09/08
05/08
01/08
-80%
According to the preliminary data in December 2009 the Industrial Turnover Index decreased by 9.8% compared to December 2008. The electricity, gas, steam and air conditioning supply reported a drop of 23.7%, the manufacturing - 5.3%, while in the mining and
quarrying industry an increase by 24.0% was seen. In December 2009, the turnover increased by 5.8% as compared to the previous month. The increase in the electricity, gas,
steam and air conditioning supply was by 9.1% and in the manufacturing - by 5.7%.
6.Retail and wholesale trade
In January 2010 according to the preliminary data, the turnover in the trade sector
decreased by 19.0% compared to the same month of the previous year
Retail Sales, % y/y
Source: NSI
15%
5%
-5%
-15%
01/10
09/09
05/09
01/09
09/08
05/08
01/08
-25%
In January 2010 according to the preliminary data, the turnover in the trade sector decreased by 19.0% compared to the same month of the previous year. Retail trade, except
of motor vehicles and motorcycles fell by 12.9%, due to the negative rates in all composite
groups. In ‘Retail sale of food, beverages and tobacco’ the drop was negligible - 1.0%, as
a result of the relatively permanent character of the consumption. In the rest trade activities, related to all types of non-food goods, the drop varied from 10.3% in ‘Dispensing
chemist; retail sale of medical and orthopedic goods, cosmetic and toilet articles in specialized stores’ to 21.9% in ‘Retail sale of computers, peripheral units and software; telecommunications equipment, etc. in specialized stores’. The reduction in ‘Retail sale of
automotive fuel in specialized stores’ was close to the average - 13.8% and the activity
formed about a quarter of the turnover volume. In Wholesale trade, except of motor vehicles and motorcycles a general reduction of 19.0% was caused by the reported drop in all
observed groups. Closer to the level of January 2009 remained ‘Wholesale of food, beverages and tobacco’ and ‘Wholesale of household goods’, which decreased by 5.7% and
6.5% respectively. Negative impact on the index had a significant drop in ‘Other specialized wholesale’ - 28.1%, also in ' Wholesale of other machinery, equipment and supplies’ 37.5%. In Wholesale and retail trade and repair of motor vehicles and motorcycles the
decline was largest - 38.3%, but the activity formed about 5% of the trade turnover and
had a negligible impact on the general index. In January 2010 the turnover fell by 28.5% in
comparison with December 2009. The trend was observed at the beginning of each year
and had a relatively permanent character. Negative rates in the three major trade activities
were close and ranged from 25.4% in Wholesale and retail trade and repair of motor vehicles and motorcycles to 29.7% in Wholesale trade, except of motor vehicles and motorcycles.
7.Unemployment
Unemployment Rate
The unemployment rate in February 2010 is 10.26%
Source: NEA
The unemployment rate for February 2010 is 10.26%q which is with 0.36% more compare
to January. The increase of the indicator started in November 2008. The number of the
registered unemployed is 380 244. This is with 13 357 people more compare to January
2010. According to the data announced by the NEA the number of the unemployed for
one working place is 30. During the month 9 504 new positions were opened. The highest
unemployment rate is registered in Smolyan 18.11% and Turgovishte 17.52%. The lowest
rate of the indicator is rported in Sofia – 3.47%, Gabrovo – 7.21% and Burgas – 7.35%.
11%
9%
7%
2010
2007
Oc
No
De
Ap
Ma
Jun
Jul
Au
Sep
Jan
Feb
Ma
5%
2008
III. FISCAL SECTOR
2009
The fiscal reserve amounted to BGN 7 672.9 mn.
The revenues from the consolidated fiscal program at the end of January 2010 amounted
to BGN 1 749.0 mn., which is 6.6% of the projected in the Budget 2010 revenues. The tax
revenues amounted to BGN 1 559.4 mn., which composes 7.4% for the one planed for the
year. Non-tax revenues and the subsidiaries amount to BGN 189.6 mn. or 3.5 % form the
revenues planed for the end of the year.
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
The expenditures on the consolidated fiscal program (including the payment for the EU
budget) amount to BGN 2 248.1 mn., which is 8.3% form the parameters set in the
budget. The payment for the EU budget amounted to BGN 76.9 mn. At the end of January 2010 the balance of the CFP was negative and amounted to BGN -499.1 mn., which
formed a deficit in the national budget amounted to BGN 303.7 mn. The fiscal reserve
amounted to BGN 7 378.9 mn. The total volume of the subsidiaries and revenues for the
republic budget at end of Janury amounted to BGN 1 279.4 mn, which is 7.5 % form the
prognoses of the year. The tax income volume at the end of January 2010 is BGN
1 154.6 mn., which is a 7.5% fulfillment of the annual budget.
Fiscal Reserve
Source: MF
16 000
12 000
8 000
4 000
IV. MONETARY SECTOR
01/10
09/09
05/09
01/09
09/08
05/08
01/08
0
1.Моney Supply
In February 2010, the annual growth rate of broad money (monetary aggregate
M3) was 8.1% compared to 5.5% in January 2010
In February 2010, the annual growth rate of broad money (monetary aggregate M3) was
8.1% compared to 5.5% in January 2010. At the end of February 2010 M3 amounted to
BGN 48.482 bn. (71.5% of GDP2) compared to BGN 47.510 bn. (70% of GDP) in January 2010. Its most liquid component – the monetary aggregate M1 – increased by 1.8%
annually in February 2010 (5.1% decline in January 2010). Quasi-money3 amounted to
BGN 30.173 bn. and rose by 12.3% compared to February 2009 (13.1% annual growth
in January 2010).
Money Supply (M3) BGN mn
Source: BNB
44000
34000
24000
2.Net domestic assets and domestic Credit
BGN
01/10
07/09
01/09
07/08
01/08
07/07
01/07
14000
Net domestic assets reached BGN 47.987 bn. at the end of February 2010, which
is a 6.8% increase compared to the same month of 2009
Foreign
Domestic credit/GDP (%)
02/09
67.3%
-7.6%
74.9%
45.8%
Domestic credit
Claims on general government
Claims on non-government sector
o/w Loans
01/09
75.0%
-5.8%
80.7%
48.5%
02/10
76.3%
-4.4%
80.7%
48.3%
Source: BNB's Monetary survey and Balance sheet of the banking system
Bank's intermediation ratios (% of GDP)
02/09
Non-Financial Corporations
Financial Corporations
Households and NPISH
Consumer loans
Loans for house purchase
Source: BNB's Monetary survey and
Balance sheet of the banking system,
Ministry of Finance (GDP 2009)
01/09
02/10
46.4%
1.1%
27.0%
10.8%
49.1%
1.4%
29.9%
12.1%
11.6%
13.2%
Net domestic assets reached BGN 47.987 bn. at the end of February 2010, which is a
6.8% increase compared to the same month of 2009 (6.6% annual growth in January
2010). The annual growth rate of their basic component – domestic credit – was 7.9% in
February 2010 compared to 7.7% in January 2010. In February 2010 claims on the
Nongovernment sector4 amounted to BGN 51.267 bn. and rose by 2.6% annually compared to 3.1% annual growth in January 2010. At the end of February 2010, claims on
loans to the Non-government sector amounted to BGN 50.638 bn. (74.7% of GDP)
compared to BGN 50.829 bn. (74.9% of GDP) in January 2010. Their annual growth rate
was 2.7% in February 2010 compared to 3.2% in January 2010. The change in claims
on loans to the Non-government sector was influenced by net purchases of loans by
Other MFIs5 - their volume for the last 12 months was BGN 1.567 bn. On an annual
basis, loans sold by Other MFI’s amounted to BGN 71.3 mn. (of which BGN 1.9 mn. in
February 2010), while the amount of repurchased loans was BGN 1.638 bn. (of which
BGN 0.2 mn. in February 2010). Loans to Non-financial corporations increased by 0.6%
annually in February 2010 (1.3% growth in January 2010) and at the end of the month
amounted to BGN 30.709 bn. (45.3% of GDP). Loans to Households and NPISH’s (Nonprofit institutions serving households) were BGN 19.040 bn. (28.1% of GDP) at the end
of February 2010, increasing annually by 5.6% (5.6% annual growth in January 2010).
In February 2010, loans for house purchase grew by 9.1% on an annual basis compared to 8.6% in January 2010. The annual growth rate of consumer loans was 6.5% in
February 2010 and 6.6% in January 2010. Other loans decreased by 12.8% annually
(11.5% decline in January 2010). The total amount of loans to Financial corporations6
was BGN 889 mn. at the end of February 2010 and compared to February 2009, it increased by 22.9% (21.1% annual growth in January 2010). Net foreign assets amounted
to BGN 15.170 bn. at the end of February 2010 compared to BGN 14.616 bn. at the end
of January 2010 and increased by 11.3% on an annual basis compared to a 4.3% annual growth in January 2010. Foreign assets increased by 2.7% annually in February
2010 (0.7% growth in January 2010), while foreign liabilities decreased by 3.9% in February 2010 (2.1% annual decline in January 2010).
3.Banking sector
49.0%
1.4%
At the end of January, the total assets in the banking system were BGN 70.2 bn.
30.0%
12.1% The data regarding the condition of the banking system as of 31 January 2010 indicate
13.3% there is no unfavorable spillover from other banking and financial systems. The liquid
asset ratio of 21.55% is an indication of the strength of the liquidity position. The impairment expenses (BGN 86 mn.) incurred in the month indicate that severity of credit risk
has not increased drastically compared to the last months of 2009.
5
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
6
The banking sector managed to generate core activity incomes that were sufficient to provide credit risk provisioning and to achieve a positive financial result of BGN 63 mn. At the
end of January, the total assets in the banking system were BGN 70.2 bn. Within the oneyear horizon, the assets registered a 1.7% growth, and compared to the end of 2009 – a
1% decrease, this change in January being in line with the cyclicity evidenced in previous
years. In January 2010, cash, loans and advances decreased, while securities in trading
portfolios and available for sale increased. The market position of the five largest banks
remained relatively unchanged at 57.8% of the assets in the system. In the month, gross
loans and advances decreased slightly (by 0.5%) as a result of the developments in all
items, particularly in the case of credit institutions. A minor increase was registered in the
housing mortgage segment (0.1%). The total loans extended to corporations, and to individuals and households were BGN 51.3 bn. with a share of 86.2% in the gross loans and
advances. The sources of financing of business remained stable. The liabilities on the banking balance sheet contracted under the impact of the usual for the season weak business
activity. Attracted funds declined by 1.2% to BGN 60.1 bn. as of end-January. The growth
trend continues in the deposits of individuals and households, that increased by 1.5% to a
total share of 42% of the funds attracted in the system. The end-January balance sheet
aggregate total capital was BGN 9.4 bn. or by BGN 1.3 bn. higher than in the same period
last year.
Idex values for the period January
2009 - February 2010
2.Stock Exchange
Source: BSE
600
SOFIX
500
The total volume of the BSE in February was BGN 25 498 mn.
400
BG 40
300
BG REIT
200
100
BGTR
30
Jan-10
Sep-09
May-09
Jan-09
0
The total volume of the BSE in February was BGN 25 498 mn. On the unofficial market the
traded volume was BGN 15 789 mn. In February the total volume of the BSE was 1.14
times more compare to the one in January which amounted to BGN 22 408 mn. On the
official market the traded volume for February decreased 0.99 compare to the one realized
in January. The average level of the indexes was as follows: 423.8 b.p. for SOFIX, 118.1 for
BG40, 44.6 for BGREIT and 326.5 for BGTR30.
3.Real estate
The avarage property prices in the five
biggest cities in Bulgaria in EUR per
sq/m
In February the average property prices in the seventh biggest cities in Bulgaria rose
with 1.2% average
Source: imot.bg
In February the average property prices in the seventh biggest cities in Bulgaria rose with
1.2% average compare to the previous month, according imot.bg. A decrease in th prices
was reported only in Blagoevgrad – 1.4.% and Burgas – 0.7%. In Stara Zagora was reported the highest increase of 4.2%. In Sofia and Varna the increase was 2.8% and 1.9%
respectively. The increase in Plovdiv and Pleven was 0.6%.
1000
800
600
Sofia
Burgas
Plovdiv
Blagoevgrad
01/10
10/09
07/09
04/09
01/09
400
Varna
UNITED BULGARIAN BANK
BULGARIA: ECONOMIC AND MARKET ANALYSES, February 2010
8
The information contained in this bulletin is derived from public institutional sources and United Bulgarian Bank
makes no representation as to the accuracy or completeness of such information. This material is not intended
as an offer or a proposal for the purchase or sale of any financial instrument. Additional information on the
theme researched in this report is available upon request. Contact: Chief Analyst, G. Kosturska phone (+359 2)
811 2982 e-mail:[email protected]