Bulgaria: Banking sector troubles subside but political risks remain

Emerging Markets Special Focus Reports

08 August 2014

Ioannis Gkionis, Senior Economist of Eurobank

• Banking sector troubles subside on the decisive actions of the authorities and the approval of a EU precautionary line for liquidity support
• The polls ahead of the early parliamentary elections suggest that a swift of power to a GERB led government coalition is likely
• Significant fiscal relaxation as a result of lackluster growth and banking sector recapitalization costs is underway