Bulgaria: Financial Sector Assessment Program: Technical Note - Financial Safety Net and Crisis Management
IMF Staff Country Reports, July 11, 2017
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- Bulgaria: Financial Sector Assessment Program: Technical Note - Financial Safety Net and Crisis Management
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Bibliographic details
- Published: July 11, 2017
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484308493.002
Overview
- This Technical Note evaluates the financial safety net and crisis management for Bulgaria.
- Since the 2008 IMF Financial Sector Assessment Program Update, Bulgaria’s financial safety net and crisis management arrangements, including bank resolution and contingency planning, have improved.
- In 2015, to implement pertinent European Union rules, Bulgaria:
- introduced a resolution regime for banks and investment firms;
- designated resolution authorities for said financial institutions; and
- established mechanisms to fund resolution measures.
- Despite the improvements, the financial safety net and crisis management arrangements face crucial challenges because none of their components is fully developed.
- To ensure operational capacity to rapidly deploy recovery and resolution tools, further actions are needed to strengthen the safety net and crisis management arrangements.
Key findings
- Improvement since 2008 in financial safety net and crisis management arrangements, notably in bank resolution and contingency planning.
- Legal and institutional changes in 2015 implemented EU rules by creating a resolution regime for banks and investment firms and designating resolution authorities.
- Funding mechanisms for resolution measures have been established.
- Critical gaps remain: none of the components of the safety net and crisis management framework is fully developed, limiting operational readiness to deploy recovery and resolution tools rapidly.
Policy implications and recommended actions
- Strengthen operational capacity to ensure rapid deployment of recovery and resolution tools.
- Further develop each component of the financial safety net and crisis management arrangements to address the current crucial challenges and gaps.
- Continue aligning national frameworks with pertinent European Union rules and ensure designated authorities and funding mechanisms are fully operational.
Scope, subjects, and keywords
- Subject: Bank resolution, Bank resolution framework, Banking, Bridge bank, Contingency planning, Crisis management framework, Financial crises
- Keywords: bank bankruptcy regime, Bank resolution, Bank resolution framework, bank resolution regime, Bridge bank, bridge bank tool, Contingency planning, CR, Crisis management framework, financial support, Global, ISCR, last-resort government stabilization tool, liquidity support, resolution authorities, resolution authority, resolution tool, uniform bank resolution regime
International Monetary Fund. "Bulgaria: Financial Sector Assessment Program: Technical Note - Financial Safety Net and Crisis Management", July 11, 2017.
Content in this bundle
- Country Report