June 22 (SeeNews) - The World Bank has said that independence of funding was the most critical matter that Bulgarian Supervisory Commission (FSC) needs to address in order to increase its efficiency.
"The FSC has a number of issues that it needs to address in order to become a world class and effective supervisor, most notably it is under-resourced and has significant training needs," the World Bank said in its Financial Sector Assessment Program (FSAP) update posted on its website. "Many of these issues arise from the lack of independence of the FSC and its current funding arrangements that significantly restrict its ability to resource itself properly."
The update represents the conclusions from the joint World Bank-IMF FSAP mission in Bulgaria in January.
The FSC is significantly under-resourced to perform its core supervision functions, particularly in insurance supervision where four persons undertake onsite inspections for nearly fifty insurers and reinsurers and 400 brokers, the World Bank said.
"The Board of the Commission needs to have the power to appoint and dismiss the staff (for good cause) of the Commission without reference to the government," the Bank said.
According to the assessment, the effectiveness of the regulator would be enhanced with a transition to more risk-based work.
In July 2016, Bulgaria's finance ministry said that The International Monetary Fund (IMF) and the World Bank will conduct an assessment of Bulgaria's financial sector throughout two two-week missions at the end of this year and at the beginning of the next one, the country's finance ministry said.
The FSAP would be a favourable precondition for future talks about Bulgaria's further integration into the common EU processes, finance minister Vladislav Goranov has said.