November 5 (SeeNews) - The Bulgarian National Bank (BNB) said on Monday that it has reviewed the other systemically important institutions (O-SII) buffer of 10 banks, applicable to the total risk exposure amount on an individual and on consolidated basis.
In accordance with data as of the end of June, the central bank decided to raise the level of the O-SII buffer applicable to United Bulgarian Bank (UBB) and DSK Bank by 0.25 percentage points, to 0.75% for each of the two lenders, BNB data shows.
The number of banks identified as O-SIIs in comparison to June 2017 has decreased by 1, as CIBANK was absorbed by United Bulgarian Bank earlier this year. Belgium's KBC Group, which held 100% of CIBANK, acquired a 99.91% stake in UBB from National Bank of Greece last year.
In October, DSK Bank's majority owner - Hungarian banking group OTP, said it has signed agreements to buy majority stakes in the Albanian and Bulgarian units of French banking group Societe Generale. The transaction is still awaiting anti-trust clearance.
O-SII buffers are set in accordance with the EU Capital Requirements Directives, which are also transposed into Bulgarian national legislation. The Capital Requirements Directives reflect the Basel III rules on capital measurement and capital standards.
The directives establish five new buffers: capital conservation buffer, bank-specific countercyclical capital buffer, systemic risk buffer, buffer for global systemically important institutions (G-SII) and buffer for other systemically important institutions (O-SII).
O-SII buffers were first applied in Bulgaria as of January 1, 2018. In accordance with the EU Capital Requirements Directives, the O-SII buffer must be reviewed at least once per year. O-SIIs are identified on the basis of the following criteria: size, importance for the economy of the EU or of the relevant member state, significance of cross-border activities, interconnectedness of the institution or group with the financial system.
The maximum value of the O-SII buffer is 2% of the total risk exposure. The buffer should consist of and should be supplementary to Common Equity Tier 1 capital.
Details follow:
Bank |
O-SII buffer 2019 (%) |
Revision (pp) |
O-SII buffer 2020 |
Revision (pp) |
UniCredit Bulbank |
0.75 |
0.0 |
1.00 |
0.0 |
First Investment Bank |
0.75 |
0.0 |
1.00 |
0.0 |
DSK Bank |
0.75 |
+0.25 |
1.00 |
+0.25 |
United Bulgarian Bank |
0.75 |
+0.25 |
1.00 |
+0.25 |
Societe Generale Expressbank |
0.50 |
0.0 |
0.75 |
0.0 |
Eurobank Bulgaria |
0.50 |
0.0 |
0.75 |
0.0 |
Raiffeisenbank (Bulgaria) |
0.50 |
0.0 |
0.75 |
0.0 |
Central Cooperative Bank |
0.50 |
0.0 |
0.75 |
0.0 |
Piraeus Bank Bulgaria |
0.25 |
0.0 |
0.50 |
0.0 |
Bulgarian Development Bank |
0.25 |
0.0 |
0.50 |
0.0 |
source: BNB