Due to the debt crisis in the Eurozone, the demand for mortgages in Bulgaria has shrunk. The size of the average mortgage has decreased in October 2011 in comparison with September 2011 according to the Bulgarian National Bank. The number of the repaid mortgages has exceeded the number of the new mortgages. This is the third decrease in the number of the new mortgages since the beginning of the recession. The previous two decreases took place in January 2009 and in January 2011, as the first month of the year is traditionally bad for lending. In the last three years only the number of the new mortgages has been steadily rising by about 2% on annual basis.
This third decrease was minimal – by only 340 000 levs (about 170 000 Euros) – but according to analysts it shows the decrease in the demand in the last two months. However, it occurred exactly at the climax of the active crediting season when banks are most active. The reason is the deepening debt crisis in the Eurozone.

The bad and the restructured credits reached 9.022 billion levs ( 4,5 billion Euros) or 22% of the credit portfolio, non-inclusive of the overdrafts. The increase in the last month was by 222 million levs (111 million Euros) due to the increase of the bad business credits by 172 million levs reaching 5.6 billion levs (2.7 billion Euros). The size of the unpaid or restructured mortgages is 1.7 billion levs and of the bad personal credits – 1.5 billion levs .
The total size of all credits lent both to businesses and individuals is 51.8 billion levs (25 billion Euros).

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Category: Bulgaria, Economy | Tags: , , , , , , Comment »

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