Bulgarian c-bank keeps countercyclical capital buffer rate at 0.5% for Q1 2021

Bulgarian c-bank keeps countercyclical capital buffer rate at 0.5% for Q1 2021

Bulgaria's central bank said that it has set the countercyclical capital buffer rate applicable to credit risk exposures in the country at 0.5% for the first quarter of 2021, same as in the previous quarter.

"Maintaining the current level of the buffer rate in 2021 Q1 may help the banking system to preserve its resilience to protracted economic downturn and to subsequent adverse developments in credit quality, increase of impairments and potential pressure on profitability and capital position of credit institutions," the Bulgarian National Bank said in a statement on Thursday.

In March, the central bank decided to cancel the planned increase of the countercyclical capital buffer to 1% as of the second quarter in order to support the sector through the coronavirus pandemic.

The countercyclical capital buffer for the second quarter of 2021 will be set in March 2021.

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