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Fibank has successfully passed the Asset Quality Review and the Stress Test

August 13, 2016

On August 13, 2016 the Bulgarian National Bank (BNB) published the results of the Comprehensive Assessment of the banks in Bulgaria for 2016 (the Assessment), which included an Asset Quality Review (AQR) and a Stress Test. The Assessment encompassed 22 Bulgarian banks, including Fibank (First Investment Bank) - Bulgaria's 3rd largest bank and the largest Bulgarian owned commercial bank. Fibank’s Asset Quality Review was conducted by Mazars Group – a renowned international audit, tax and advisory services firm, with the methodological guidance of Deloitte, under BNB oversight and with the full cooperation of the Bank. Following the Assessment, banks in Bulgaria must take concrete measures within the relevant time frames.

Fibank is pleased to announce that the Assessment confirmed the quality and soundness of its assets and capital position:

  • It indicated that Fibank has sufficient capital to meet the requirements of the Basic Scenario of the Stress Test, which scenario most closely approximates the economic development forecasts of the BNB and the Ministry of Finance.
  • The Bank has already taken concrete steps, approved by the BNB, with a view to increasing its capital buffers under the hypothetical Adverse Scenario.
  • The approach and results of the Stress Tests are in line with similar results observed recently in other European banks. These results are available on the EBA website at: http://www.eba.europa.eu/risk-analysis-and-data/eu-wide-stress-testing/2016/results
  • he hypothetical Adverse Scenario is based on the assumptions of prolonged and deep slump in the economy of the country for a period of three years which is not an economic forecast, is not likely to materialize, and should not be treated as indicative of the future financial performance of banks in Bulgaria, or of the country as a whole.
  • With a view of the AQR results, BNB recommends generating BGN ~206M incremental capital buffer.
  • The Bank's profit before provisions and taxation for the first six months of 2016 amounts to BGN 146.6M.

Fibank’s financial results were achieved alongside a successful reorganization program, which aimed at improvements of corporate management and risk management under the guidance and collaboration of the International Financial Corporation (IFC) and was positively reflected in the external ratings of the Bank.

  • After completion of the AQR process, the Bank will place its main focus on SME and retail lending, while at the same time preserving the excellent quality of services offered, and the high level of customer satisfaction.
  • The Bank will continually aim to be among the most innovative banks in Bulgaria and always remain close to its customers. Social responsibility has always been part of our corporate philosophy: having passion and commitment for our country and society, and supporting projects of importance to them.

The above actions will further strengthen the robustness and soundness of the Bank, and increase its potential for future sustainable growth.

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