Banks that have the most aggressive lending policies will have to have additional minimum obligatory reserves at Bulgarian National Bank (BNB), which will serve as an additional ‘buffer’ if loans are not repaid. This is envisaged in the most recent changes BNB made to the ordinance on minimum obligatory reserves of commercial banks. The change is aimed at achieving stabilisation of the pace of increase of credit supply, without hampering the financial stability of the banks.
The new requirement will apply only to banks that correspond to certain criteria. One is to have exceeded the BNB fixed credit growth increase. The measure is of a temporary nature and will remain in force until a more moderate and stable growth of private sector credit is reached. (Novinar)