Fitch Raised the Outlook of the Bulgarian Development Bank’s Long-term Credit Rating
The international rating agency, Fitch Ratings, raised the outlook of the Bulgarian Development Bank’s long-term credit rating from BBB stable to BBB positive. This is the highest possible credit rating to a financial institution in Bulgaria.
Rating agency’s rating reflects the high probability of support from the Bulgarian sovereign, BDB’s great financial results as well as its role in supporting the government's economic policy. The positive outlook shows the existing balance of risk which are related to the credit rating evaluation. The agency’s announcement indicated that in case the Bulgarian sovereign receives an upgrade it will likely drive an upgrade of BDB's one as well.
BDB’s assets had a year-on-year increase by 22% as per end-2018 and exceeded BGN 3 billion. The bank maintains the highest liquidity and capital adequacy levels within the Bulgarian banking system. The capital adequacy ratio is 40.5%, whereas the market average is 20%, along with liquidity coverage ratio of 1,300%, whereas the market average is 228%. In 2018 the financed business loans amounted to almost BGN 400 million, whereas compared to 2017 there were BGN 120 million, along with an on-lending program increase of 400%.
In 2018 the bank signed an agreement for a long-term investment resource of EUR 1.5 billion with foreign financial institutions, including the Chinese Development Bank and Chinese Exim Bank. BDB is also a partner with European Investment Bank (EIB), The Council of Europe Development Bank (CEB), the German development bank KfW, and others.
BDB established three new subsidiaries – Capital Investment Fund, BDB Leasing, BDB Factoring. Those, along with National Guarantee Fund and JOBS Microfinancing Institution, complete the financial group.