The European Bank for Reconstruction and Development will extend a loan of 300 million euros to the Bulgarian Deposit Insurance Fund (BDIF) under a deal signed in Sofia on Thursday.
The loan has maturity of nine years with a six-year grace and will replenish BDIF’s reserves, giving “a greater financial independence and sustainability in the long run” to the Fund’s finances, the Bulgarian Finance Ministry said in a statement.
"The loan will be conditional on the accomplishment of steps undertaken by BDIF in light of the new legislation frameworks for deposit insurance and bank recovery and resolution, implemented in mid-2015 to transpose requirements of the respective EU directives," the EBRD said in a separate statement.
The funding agreement was signed by BDIF Board Chairman Radoslav Milenkov and the EBRD Regional Director for Bulgaria and Romania Matteo Patrone. Separately, Finance Minister Vladislav Goranov and Matteo Patrone signed a loan guarantee agreement which has to be ratified by parliament to take effect.
Matteo Patrone commnted in the statement that the loan was "a landmark investment for the EBRD as it supports the development of the local banking market infrastructure."
Sofia News Agency