Bulgaria has sold state bonds to the value of 950 million levs (425 million euros) on the international market with interest of 4.5% which is much lower than the interest of the Italian and Spanish state bonds. The number of the buyers was five times higher than the number of the state bonds. The market profit of the bonds is 4.436% which is higher than the one of the German state bonds that are considered to be safe and not risky. Most of the buyers were German investors, but there were also some from Europe, the Middle East and Asia.
At the end of 2011 the profit of the Bulgarian banks has reached 586 million levs (270 million Euros). In the last three years the Bulgarian banks have saved their profit to create a buffer zone of capital for emergency situations. Thus at the end of last year in the banking system there was a surplus of 2.9 billion levs (1.5 billion Euros) on top of the required capital.
The volume of the profit of the Bulgarian banks has been shrinking until the beginning of last year due to the expenses for servicing bad credits and due to the high interest on the deposits. However, during 2011, the banks managed to turn this tendency around. In January and February 2012 they recorded an increase of their profit. In January 2012 the increase on annual basis was by 19.2%, while in February 2012 it has reached 34.7% or 118 million levs (60 million Euros).
59.8 billion levs have been held in Bulgarian banks in May 2009 which is a decrease by 437 levs, according to the Bulgarian National Bank (BNB). This is the second most serious decrease of the amount of money in the Bulgarian banks since the beginning of the year. This is mainly due to the fact that the amounts which foreign banks and other foreign credit institutions keep in Bulgaria have decreased by 390 million levs in May 2009. Despite this the amount which they keep here is not small – 15.4 billion levs.
In comparison personal savings total 22.8 billion levs and the total of the funds of companies in Bulgarian banks is 19 billion levs. The personal savings have decreased by 100 million levs despite the attracting interest rates of savings. The total amount of the money in companies’ accounts has slightly increased.
From January 2009 the level of the money in the accounts held at the Bulgarian banks tend to fluctuate both ways on almost permanent basis. The most significant withdrawals took place in January and in May. In January about 800 million levs have been withdrawn, 500 million levs of them were withdrawn by foreign banks. The Bulgarian companies withdrew 600 million levs but personal savings increased by 340 million levs.
The personal accounts have a positive balance while the companys’ accounts are in the red. In May individuals held 22.8 billion levs in their accounts while they had credits amassing to 17.7 billion levs. The companies at the same time held 19 billion levs into their accounts but they owe the banks 32 billion levs. On the whole the Bulgarian banking system is one of the few in the EU which is profitable. Its profit in the end of May 2009 was 402 billion levs. The liquidity index is 20.6% which means that 20% of the attracted funds in the banks can be immediately paid in cash if requested.
Property prices in Bulgaria have fallen by 13.57% in the first quarter of 2009 in comparison with the same period last year, according to the Global Property Guide. This time last year the Bulgarian property prices have registered an increase of 16%. Now, in 14 countries the property prices have dropped by more than 10%. The main reason for this tendency in Bulgaria is the drop in the number of foreign buyers.
According to the Global Property Guide the property market is in crisis in 27 out of 32 reviewed countries. The main reasons for this are the growing unemployment, stricter bank rules for landing and diminishing consumer confidence.
Only a few countries experienced increase of property prices. Switzerland is in the first place with a growth of 4% in the first quarter of 2009. The main reason for this is the stable demand supported by falling interest rates and the presence of a great number of foreign buyers. Next are Thailand, Austria and Israel with a price growth of 3%, shortly followed by Shanghai with 1.76%.
A repossessed one-bedroom apartment in an affluent area of Sofia can be purchased for 25 000 Euros at an auction. According to the court statistics there is a boom in the number of the auctioned repossessed properties in the last few months. The information about these auctions is displayed in the municipalities and the auctions take place at the regional courts. A repossessed property is evaluated by a judge who then auctions it at 50% of the market price. Due to the recession and the collapse of the property market, there is no interest in repossessed properties. If such a property does not sell, it is offered again at an auction a month later at a price which is further 20% decreased. The expectations are that the number of the repossessed apartments will continue to grow.