Publication: Bulgaria Detailed Assessment of Observance: Basel Core Principles for Effective Banking Supervision
Date
2015-09
ISSN
Published
2015-09
Author(s)
International Monetary Fund
World Bank
Abstract
This assessment of the current state of
the implementation of the Basel core principles (BCP) for
effective banking supervision in Bulgaria has been completed
as a stand-alone report on the observance of standards and
codes undertaken by the international monetary fund (IMF)
and the World Bank during March of 2015 at the request of
the Bulgarian authorities. It reflects the regulatory and
supervisory framework in place as of the date of the
completion of the assessment. The Bulgarian National Bank
(BNB) has an internal governance structure which, by vesting
the majority of the powers of supervision in the Deputy
Governor for banking supervision, exposes the supervisory
function to risks. Under the BNB’s legal structure,
supervision and enforcement is dissociated from the
Governing Council, and the Governing Council has no right to
compel transparency of decision making or to impose a
framework to ensure consistency in the use of the
enforcement regime. There are material concerns that the BNB
is too resource constrained to deliver effective minimum
levels of supervision. Despite a broad range of supervisory
powers, there are some gaps in the legal framework that
unduly restrict the BNB’s locus. The BNB has a good
understanding of risk and many strong practices, and also
making good use of international standards and guidelines,
but there are some important system wide vulnerabilities.
The assessment team reviewed the framework of laws, rules,
and guidance and held extensive meetings with officials of
the BNB, and additional meetings with the Finance Ministry,
auditing firms, professional bodies, and banking sector
participants. The authorities provided a comprehensive
self-assessment of the CPs, as well as detailed responses to
additional questionnaires, and facilitated access to
supervisory documents and files on a confidential basis as
well as staff and systems.
Citation
“International Monetary Fund; World Bank. 2015. Bulgaria Detailed Assessment of Observance: Basel Core Principles for Effective Banking Supervision. © Washington, DC. http://hdl.handle.net/10986/22678 License: CC BY 3.0 IGO.”