On 11 September 2020 the European Central Bank (“ECB”) announced the names of the Bulgarian banks that will be subject to direct supervision under its Single Supervisory Mechanism (“SSM”) mandate as of 1 October 2020. This follows the establishing of close cooperation between the Bulgarian National Bank (“BNB”) and ECB in July and the subsequent assessment of the significance of the Bulgarian banks pursuant to Regulation (EU) No 1024/2013[1].

The following five banks shall be directly supervised by the ECB.

  • UniCredit Bulbank AD

  • DSK Bank AD

  • United Bulgarian Bank AD

  • Eurobank Bulgaria AD and

  • Raiffeisen bank (Bulgaria) EAD

The list includes four Bulgarian subsidiaries of existing significant banking groups headquartered in Italy, Belgium, Greece, and Austria. Additionally, the ECB will also directly supervise an entirely new institution - DSK Bank AD.

Additionally, the ECB will also be in charge of the oversight of the less significant institutions which shall be performed on a day-to-day basis by the BNB and shall be responsible for the common supervisory procedures and guidelines for all supervised entities in Bulgaria.

Further, from 1 October 2020, the Single Resolution Board (“SRB”) shall become the resolution authority for all significant institutions in Bulgaria pursuant to Regulation (EU) No 806/2014[2] as well as for all cross-border groups within the meaning of Regulation (EU) No 806/2014. The BNB shall remain the national resolution authority for the remaining less significant institutions, with the SRB maintaining overseeing capacity with respect to resolution planning for such nationally supervised entities. Pursuant to Regulation (EU) No 806/2014 all Bulgarian credit institutions and all investment firms, where they are covered by the consolidated supervision of the parent undertaking carried out by the ECB under its SSM mandate, shall also contribute to the Single Resolution Fund, which supports the exercise of the resolution powers conferred to the SRB.