Bulgarian Banks' Net Profit To Halve to 358 Mln Euro in 2009 - Media

The profit for the current year will be capitalised which will raise the capital buffer against bad loans to some 3.5 billion levs, BTA quoted central bank governor Ivan Iskrov as saying.

Bulgaria had 24 domestically-registered banks and branches of six foreign lenders at the end of September. They had a combined net profit of 621.6 million levs in the first nine months of the year, down from 1.1 billion levs a year ago.

Non-performing loans will reach 6.0% of Bulgarian banks' loan portfolio at the end of 2009 but the banks are capitalised well enough to deal with this problem, Iskrov said.

"Even though we have an rise in non-performing loans in 2009, which is normal in the difficult economic situation, the Bulgarian banking system, thanks to strict regulations, has built up solid buffers to meet these challanges," BTA quoted Iskrov as saying.

The banking system's liquidity is around 20% and its capital adequacy ratio has increased to some 17% at the moment from 14% at the end of 2008, Iskrov said.

(1 euro = 1.95583 Bulgarian levs)