Bulgarian c-bank keeps countercyclical capital buffer at 0.5% for Q4

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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 fourth quarter of 2020, same as in the previous quarter.

“Maintaining the current level of the buffer rate in 2020 Q4 may help the banking system to preserve its resilience to adverse developments in economic activity and subsequent deterioration of credit portfolio quality, increase of impairments and potential pressure on profitability and capital position of credit institutions,” the Bulgarian National Bank said in a statement on Tuesday.

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 first quarter of 2021 will be set in December

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