Bulgaria's Bank System Can Cope with Bad Credit - Analyst

Bulgaria's bank system has enough buffers to cover bad credits, according to Open Society economist Georgi Angelov.

Giving a lecture Saturday, Angelov commented that although bad credits have reached unprecedented highs, the banking system in the country remains stable.

According to data quoted by the economists, 14.45% of all loans (outside of loans to financial institutions) in Bulgaria around September 2011 are delinquent.

Loans amounting to BGN 3.8 B have been discounted as uncollectible around the same date.

At the same time, the amount of loans not covered by bank provisions is only BGN 0.7 B, or 1.1% of the total amount of loans in Bulgaria.

Angelov commented that the Bulgarian banks' own capital and a good level of liquidity (25.9%) provide good buffers for bad credits.