The global credit crunch will affect Bulgarian bank sector
Maia Georgieva, Chief Executive, First Investment Bank
Ms Georgieva, what will be the effect from the global credit crunch in Bulgaria?
Ms Georgieva
Bulgaria inevitably will be affected by the global financial crisis, but that would be a positive process for us. Now Bulgarian banks tightened its criteria for lending credits to its clients. On the other side loan applicants assess more cautiously its possibilities to repay the obligations.
Is there liquidity crisis in Bulgaria?
Ms Georgieva
Most Bulgarian banks are subsidiaries of foreign credit institutions and should conform to the global situation. Resources are more expensive and banks raise its interest rates to attract fresh funds. For example the UK Halifax Bank of Scotland (HBOS) offers a year-fixed saving deposit with interest rate of 10 percent. This clearly indicates that banks look for ways to ease liquidity crunch.
The same process we observe here in Bulgaria and higher rates will cut the loan demands.
What kind of measures will take First Investment Bank?
Ms Georgieva
We, in First Investment Bank, will attempt to encourage the thrift of Bulgarians. We will present new products with preferential terms. At the same time First Investment Bank will remain offering good credit proposals.
Comments
Add comments