site.btaBNB Governor Warns of Potential Risk Related to Mortgage Lending

The Bulgarian National Bank (BNB) announced at the beginning of the week that it obliges commercial banks and branches operating in the country to monitor at least six indicators when granting and renegotiating loans secured by residential property.

The indicators include compliance with loan-to-value ratios, ratios between the amount of current payments related to servicing the loan secured by residential real estate and the borrower's monthly income, the maximum term of the loan agreement, etc.

BNB Governor Dimitar Radev told BTA that the BNB does not see an immediate problem, but does see a potential risk related to mortgage lending. In his words, in the short term, most borrowers will not be seriously affected by the changes.