The aggregate net profit of Bulgarian commercial banks fell 39.3% y/y to BGN 230.2mn (EUR 117.7mn) in January-July 2014 mainly due to a significant increase in the impairment losses on assets held by troubled Corporate Commercial Bank (Corpbank), central bank data showed.
The banking system's total impairment losses rose by BGN 286.2mn during the month of July, reflecting a BGN 205.2mn increase in the losses of Corpbank alone. As a result, the sector's aggregate impairment costs surged 42.5% y/y to BGN 825.3mn at end-July.
The rise in Corpbank's impairment costs pushed up its seven-month operating loss to BGN 258.8mn from a loss of BGN 65.3mn for the first half of 2014 alone.
Meanwhile, the banking system's net interest income rose 8.2% y/y to BGN 1.57bn in Jan-July 2014, accelerating from the 7% increase recorded in Jan-June alone. The growth came on the back of a 13.9% y/y drop in interest expenses, which offset a 2% y/y decline in interest income. The sector's net fee and commission income inched up 0.9% y/y to BGN 478.2mn.
|Banking sector income statement||2009||2010||2011||2012||2013||Jan-Jul 2014|
|Net interest income|
|Net fees&commissions income|
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