Deposits in Bulgarian Banks Increased to Record Level in Past YearFinance | July 2, 2015, Thursday // 10:49| views
The savings of citizens and non-profit organisations in Bulgarian banks increased by more than BGN 1.5 B in the past year.
According to the latest figures of the Bulgarian National Bank (BNB), the savings amounted to BGN 42.5 B at the end of May, registering a new record level.
Depositors seem to have retained their confidence in Bulgarian banks, as the deposits increase despite the lower interest rates.
In the past months, the return on deposits in Bulgaria is similar to that in the most member states of the EU, Darik radio reports.
In May, the average interest rate on deposits held in BGN was 1.63 %, while that for deposits held in EUR was 1.25 %.
Despite these interest rates, the savings increased by BGN 204.5 in just a month, one of the possible explanations being that Bulgarians still lack culture of investment.
This increase can also be explained by the Greek crisis, which has forced Greek citizens to transfer their assets to Bulgarian banks in search for greater safety.
Holding accounts in Bulgarian banks also allows Greeks to have free access to their deposits, in contrast to the situation in Greece, where capital controls were imposed limiting cash withdrawals to EUR 60 per day.
While deposits in Bulgarian banks have increased, loans remain in stagnation, with credits and advances having shrank by BGN 83.5 M to BGN 60.7 B in May.
The loans of households amounted to BGN 18.5 B, recording a slight increase of BGN 46 M, which was mainly due to the growth of consumer credits.
However the credits of firms registered a considerable drop of BGN 380 M in just a month.