Bulgarian Credit Rating Agency (BCRA) in co-operation with ICRA, associated partner of Moody’s, awarded Encouragement Bank with a long-term rating of BB with positive perspective. This is the first credit rating of the Bank.
The awarded rating takes into account the stability and the existing potential of the credit institution. The main particularity of Encouragement Bank’s activity has been taken into consideration, namely its work with small and medium sized enterprises as well as the priority financing of the operations of the credit institution obtained from long-term resources attracted from international financial institutions.
BCRA assesses the risks related to the quality of income, resource base and those, deriving from the organization of the business processes, as low. A high capitalization level of the Bank has been achieved.
As a significant factor of the expectations for positive development of the institution, the BCRA analysts determine the foreseen transformation of Encouragement Bank into the Bulgarian Development Bank and the possibility of obtaining a state guarantee of the institution’s liabilities.
Encouragement Bank was incorporated in 1999 and is currently the sole state-owned bank in Bulgaria. The Bank is a leader on the market of long-term investment financing. The extended loans have a tenor of 10 years and a grace period of up to 3 years. Encouragement Bank is the only bank which provides loans to small and medium sized enterprises with collateral going up to 85%.
