ECONOMY

Top Bulgarian banker urges consolidation

SOFIA (Reuters) – Svetoslav Gavriiski, the central bank governor, yesterday urged further consolidation of Bulgaria’s banking sector to boost its efficiency as the country works toward hoped-for European Union membership. Gavriiski, who reiterated plans to seek a second term in office, said the creation of a stable banking system demonstrated the success of his first six-year term, due to expire next week. Bulgaria has strengthened its banking sector with the help of an IMF-prescribed strict currency board regime, introduced in 1997 after a severe financial crisis the previous year wiped out about a third of the country’s banks. Sofia, which has a target of EU entry in 2007, has said it will stick to the fixed exchange rate mechanism that pegged the lev to the euro at least until it joins the rich nations’ bloc. «Bulgaria’s banking system is now fully in private hands, with foreign participation exceeding 85 percent. In practice, we have a banking system of the EU, with stable and prosperous banks which is a guarantee for banking stability,» Gavriiski told a news conference. The country’s bank privatization, launched in 1997, was completed last month with the sale of the second biggest DSK Bank to Hungary’s OTP Bank for 311 million euros.