Ivaylo Iaydjiev: Bulgaria Needs to Make BNB More Accountable, Transparent and Independent

Opinions | April 27, 2015, Monday // 17:22|  views

Bulgarian National Bank's headquarters building in central Sofia. File photo by BGNES

Bulgaria should implement crucial reforms to improve the leadership, accountability and transparency of its central bank, the BNB, in the aftermath of the 2014 banking crisis, Ivaylo Iaydjiev has opined in an article published by EUobserver on 27 April 2015.

First, the next BNB governor, who is due for appointment later this year, “should be a respected technocrat selected in a transparent manner”, according to the author, who is a doctoral candidate at the Blavatnik School of Government at the University of Oxford.

Second, the collapse of Bulgaria's fourth-largest lender, the Corporate Commercial Bank or KTB, “has revealed accountability weaknesses in the institutional setup of the BNB” that should be remedied.

Third, the author writes, the BNB needs to significantly boost transparency.

With accession to the European Central Bank’s Single Supervisory Mechanism (SSM) likely to remain a key objective for Bulgaria, especially if the country is to move towards adoption of the euro, the ECB should clearly articulate that strengthening the accountability, transparency and independence of the BNB is a key prerequisite for Bulgaria’s application to join the SSM, the author says.

“To date European policymakers appear to have paid little attention to Bulgaria’s financial drama. Now is the time for the EU to engage, and encourage reforms to the governance of the central bank,” Iaydjiev opines.

You can read the full opinion piece “How the EU can help Bulgaria avert another banking crisis” here.



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Tags: Bulgaria, Central Bank, Ivaylo Iaydjiev, ECB, EUObserver, BNB, EU


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