AUGUST 29 No 1 / 29 > The Bulgarian stock market showed signs of awakening in August: the SOFIX went up, regaining its levels form the end of 28
DEBT MARKETS Benchmark yield curves in the euro area.29 and 7.9.29 8 7 annual yield (%) 6 5 4 3 2.29 7.9.29 1 o/n depo 1w depo 1m depo 3m bill 12m bill instrument 3y 5y 7y 1y Benchmark yield curves in Bulgaria.29 and 7.9.29 9 8 7 annual yield (%) 6 5 4 3 2.29 7.9.29 1 o/n depo 1w depo 1m depo 3m bill 12m bill instrument 3y 5y 7y 1y Bulgaria and euro area benchmark yield curves 7.9.29 annual yield (%) 8 7 6 5 4 3 2 1 Middle of SOFIBID and SOFIBOR SOFImid Bulgaria euro area o/n depo 1w depo 1m depo 3m bill 12m bill 3y 5y 7y 1y instrument 2
Yields on EUR-denominated govt securities in Bulgaria and on the euro area curve 7.9.29 7 6 annual yield (%) 5 4 3 2 BG domestic BG global euro area 1 3m bill 12m bill 2y 3y 4y 5y 6y instrument 7y 8y 9y 1y 15y SOFIBOR and 3M T-bill issuance, January - August 29 (%) 9 8 7 6 5 4 3 2 1 5.1 15.1 25.1 1. MONEY MARKET 4.2 14.2 24.2 6.3 16.3 26.3 5.4 15.4 25.4 5.5 15.5 25.5 4.6 14.6 24.6 4.7 14.7 24.7 3M SOFIBID 3M SOFIBOR 3M T-bill LEONIA BIR In August the interbank money market monthly volume decreased by 8.5 per cent below July to BGN 6277.3 million, resulting from a 5.6 per cent decline in the deposit 23.8 Vladimir Tsonchev (+359 2) 9145 1712 No issuance of 3M government securities in August 3
lending deals volume to BGN 5751.9 million and from a 31.4 per cent drop in repo deals to BGN 525.4 million. In August the total monthly volume of term transactions in Euromoney market dealing also decreased compared to July. But here the decline is only in depo deals volume by 25.3 per cent to BGN 449.2 million, while in repo deals volume there was an increase by 33.8 per cent to BGN 279.8 million. The average daily excess reserves in August decreased to BGN 6768 thousand after BGN 1688 thousand in July. In 13 calendar days altogether (on 3 rd, from 13 th till 16 th on 19 th, from 24 th till 3 th, including the holidays) of the month there was relative resource shortage (negative excess reserves). 8 Interbank money market and excess reserves, August 29 (BGN mln) 6 4 2-2 -4 money market excess reserves Liquidity in the banking system is influenced every month by monetary flows through government securities (bills and s of the Ministry of Finance), and in August there was a net inflow to banks of BGN 14.7 million as an 4
increase in resources. Pension transfers amounted to BGN 676. million as an increase in resources. 8 Deposit deals, August 29 (BGN mln) 7 6 5 4 3 2 1 all deposit deals unsecured of which overnight secured 1.1. Interbank market: deposit lending and repo- transactions 1.1.1. Cash market Deposit lending maintains a prevailing share in the interbank money market volume, which for August has increased to 91.6 per cent of the interbank transactions, after 88.8 per cent in July. It is commercial banks main tool for managing current daily liquidity. 1.1.1.1. Unsecured market In August term unsecured deposit lending between market participants amounted to BGN 5751.9 million, and 83.1 per cent of this (BGN 4781.8 million) were overnight deals, compared to 77.8 per cent share (BGN 474.1 million) in July. 5
8 Unsecured deposit market, August 29 (BGN mln) 7 6 5 4 3 2 1 overnight other Commercial banks, via overnight transactions, provide additional resources at the beginning of every month for the regulation of required minimum reserves and in the middle of the month for clients payments. 3. LEONIA / EONIA 2.5 2. 1.5 1..5. LEONIA EONIA 6
The monthly average for the overnight interest rate on unsecured deposit lending is an annual 1.56%,.15 percentage points lower than the BIR (base interest rate, effective from the first calendar day of each month and equal to the simple average of the LEONIA reference rate values from the previous month), 1.71% in August. 1.1.1.2. Secured market There is no secured deposit lending in August. The repo deals share decreased to 8.4 per cent of the total transactions volume (BGN 525.4 million), after 11.2 per cent in July. 1.1.2. Derivatives market Not yet developed in the country. In August the monthly average of the LEONIA, a reference rate based on unsecured overnight deposit lending by 12 banks, decreased to 1.57%. Hence the size of the BNB base interest rate for September 29 is 1.57%. BULGARIAN INTERBANK MONEY MONEY MARKET AND EUROMONEY MARKET DEALS BETWEEN BULGARIAN BANKS, AUGUST 29 (in millions of the respective currencies) MARKETS: interbank money market euromoney market deals between Bulgarian banks value in millions of BGN deals in BGN deals in EUR deals in USD deals in other currencies equivalent in millions of EUR value in millions of EUR equivalent in millions of BGN value in millions of USD equivalent in millions of BGN equivalent in millions of EUR equivalent in millions of BGN equivalent in millions of EUR TYPES OF DEALS: unsecured deposit deals 5751.9 294.9 146. 2855.5 825.8 1132. 578.8 61.7 31.5 secured deposit deals - - - - - - - - - repo of Bulgarian govt securities* 525.4 268.6 133.5 261.1 13.6 18.6 9.5 - - outright purchases of short-term BGN Bulgarian govt securities - - - - - - - - - outright purchases of long-term** BGN Bulgarian govt securities* 33. 16.9 - - - - - - - outright purchases of long-term** forex Bulgarian govt securities*.. - - - - - - - * at market value; for repos - only the security purchase (money lending) leg ** s of over 1 year in original maturity Source: BNB, from commercial banks' daily reports 1.2. Outright purchases of securities on the secondary market On the interbank secondary market for government securities, the market value of outright purchases in August amounted to BGN 33. million (after BGN 49.7 million in July), and all the deals were with longer than 12 months securities. 7
18 Outright deals in Bulgarian government securities, August 29 (BGN mln) 16 14 12 1 8 6 4 2 BGN-denominated securities up to 12M forex-denominated securities BGN-denominated securities over 12M 2. CAPITAL MARKET The monthly secondary market stock-exchange turnover of corporate s marked an almost fourfold decrease in August amounting to BGN 4.1 million (a daily average of BGN.2 million) compared to BGN 15.7 million in July. Boris Malinchev (+359 2) 9145 174 Off-stock-exchange were concluded deals in s at the amount of BGN 1. million. BSE transactions with s, August 29 (date T; BGN mln) 1 9 8 7 6 5 4 3 2 1 official official OTC unofficial unofficial OTC 8
The prices of EUR-denominated 213 went up above the 18% mark, and of USD-denominated 215 globals surpassed the 11% level. On the secondary market the price of the compensation instruments decreased slightly to BGN.25 per item at the end of the month. The compensation instruments market turnover marked a decrease, amounting to BGN.8 million, compared with the BGN 2.2 million in July. Deals concluded off-stock-exchange in August had insignificant amount. In August the market turnover of units in collective investment schemes decreased multifold to BGN.1 million compared with the BGN 3.7 million in July. 5 4 3 2 1 BSE transactions with compensatories, August 29 (date T; BGN thousand) unofficial unofficial OTC privatis. (comp) 9
ASSET MARKETS NET ASSETS: Equity 125 115 15 95 85 BG4 and SOFIX 5 45 4 35 3 75 25 1.1.9 31.1.9 2.3.9 1.4.9 1.5.9 31.5.9 3.6.9 3.7.9 29.8.9 BG4 SOFIX (right scale) GROSS ASSETS: Real Estate 125 12 115 11 15 Real Estate Prices (BGN per sq. m.) (National Statistical Institute quarterly data) 1 95 9 85 8 1.1.9 1.2.9 1.3.9 1.4.9 1.5.9 1.6.9 1.7.9 1.8.9 16 Gold (XAU/BGN) 15 Commodities 14 13 12 11 1 1.29 2.29 3.29 4.29 5.29 6.29 7.29 8.29 1.6 Forex (USD/BGN) 1.55 1.5 Forex 1.45 1.4 1.35 1.3 1.29 2.29 3.29 4.29 5.29 6.29 7.29 8.29 1
EQUITY CAPITAL (NET ASSETS) Boris Malinchev (+359 2) 9145 174 BSE-SOFIA IPO MARKET (in millions of BGN) August 29 Issued securities Equities Bonds Rights Securities to be traded on: official market unofficial market official market unofficial market unofficial market DEALS: Source: BSE-Sofia daily reports TRADE IN SECURITIES REGISTERED ON THE BSE-SOFIA: STOCK-EXCHANGE AND OTC TURNOVER (in millions of BGN) August 29 MARKETS EQUITY MARKETS MARKET OF BOND MARKETS OTHER MARKETS Trade in equities not Official Market of Unofficial Market Official Market of Bonds Unofficial Market of registered on the BSE- Equities of Equities Bonds Sofia SPECIAL PURPOSE INVESTMENT COMPANIES (segments A,B) (segments A,B) municipal s corporate s municipal s corporate s Market of compensation instruments Market of Subscription Rights Market of Collective Investment Schemes of public companies of nonpublic companies INSTRUMENTS AND DEALS: BSE trading Trade in primary instruments, of which: 48.6 14.4 3.3. 4.1.8..1 regular deals 48.6 14.4 3.3. 4.1.8..1 - - privatis. market deals (cash) - - - - - - - - Privatis. market (compensative)* - - - - - - - - INSTRUMENTS AND DEALS: - OTC trading Trade in primary instruments (block, registration, repo, tender purchases, redemption, etc.)** 4.5 99.4 3.9 1..1..2 - - Source: BSE-Sofia daily reports * Not included in the above totals ** From 16 June 28 off-stock-exchange trade is not reported by type of deals due to introduction of new trading platform XETRA The Bulgarian Stock Exchange Sofia (BSE-Sofia) monthly turnover in equities in August marked a significant increase amounting to BGN 66.3 million (a daily average of BGN 3.2 million), compared to BGN 18.3 million in July. More substantial volumes reached the trade in shares of Research and Extraction of natural gas AD and Chimimport AD. The turnover in deals concluded off-stock-exchange (reported through the stock-exchange platform) amounted to BGN 17.8 million. The biggest volume had the deals with shares in Cereals Bulgaria AD (BGN 96 million). 11
BSE transactions with shares, August 29 (date T; BGN mln) 5 45 4 35 3 25 2 15 1 5 The prices of the Bulgarian stock market during the month showed stronger upward trend compared with the prices of the regional and leading world stock markets. privatis.(bgn) SIPC OTC SIPC unoff. OTC unoff. official OTC official DAX, SOFIX and BET, August 29 6 55 55 5 45 4 35 3 25 2 15 1 DAX BET SOFIX (right scale) 5 45 4 35 3 25 2 15 1 12
BG4, August 29 13 12 11 1 9 8 Pension fund price indices, August 29 (1 July 24 BGN 1) 1.25 1.2 1.15 1.1 1.5 1. 8.8 9.8 VOLIDEX PROFIDEX UNIDEX 15.8 16.8 22.8 23.8 29.8 3.8 13
There were no placements of shares on the IPO market of the BSE-Sofia in August. BSE primary market, August 29 (date T; BGN thousand) 1 8 6 4 2 shares rights/shares govt sec. s 3. FOREIGN EXCHANGE MARKET In August 29 the USD exchange rate against BGN was moving between the values of 1.35727 on 5 August and 1.38987 on 17 August. The average USD exchange rate was 1.3784, which is almost.2 BGN lower than the previous month s value. Lubomir Tonev (+359 2) 9145 168 Plamen Petrunov (+359 2) 9145 161 1.4 Daily BNB reference exchange rate for the USD, August 29 (BGN per USD 1) 1.39 1.38 1.37 1.36 1.35 8.8 9.8 15.8 16.8 14 22.8 23.8 29.8 3.8
4 Daily USD turnover and exchange rates of (commercial) banks, August 29 1.42 35 3 1.4 USD mln 25 2 15 1 5 traded between banks sold to customers average rate for sales to customers Total monthly foreign exchange market turnover, August 28 to August 29 (in mln of EUR) 1.38 1.36 1.34 1.32 bought from customers average rate for purchases from customers average interbank rate BGN per USD 1 August-9 July-9 June-9 May-9 April-9 March-9 February-9 January-9 December-8 November-8 October-8 September-8 August-8 42,8.1 47,25.2 49,818.9 39,142.6 44,43.3 44,854.7 44,675.6 41,935.7 48,298.3 53,238.6 56,876.8 47,747.4 47,432.7 In August the total turnover of the foreign exchange market reached EUR 428.1 million. The average daily turnover was EUR 2.4 million and the interbank turnover (without BNB) was, in euro terms, EUR 78.3 million. The USD trade between (commercial) banks was 15
USD 2.7 million and comprised 18.5 percent of interbank foreign exchange trading. Foreign exchange trading between (commercial) banks, August 28 to August 29 (in mln of EUR) August-9 July-9 June-9 May-9 April-9 March-9 February-9 January-9 December-8 November-8 October-8 September-8 August-8 78.3 75. 67. 52.3 78.4 18.5 89.9 72.5 97.2 133.2 141.2 175.3 194.9 August-9 July-9 June-9 May-9 April-9 March-9 February-9 January-9 December-8 November-8 October-8 September-8 August-8-12446 -12952-11517 Monthly EUR trading between BNB and banks, August 28 to August 29 (EUR mln) -1841-129 -1444-152 -1171-9686 -9649-1664 -1118-934 26-95 2-77 -176-264 -397-336 -433-312 -283-48 664 9712 1746 11537 8957 133 118 115 9313 1639 12134 12669 1616 1782 bought from banks sold to banks net 16
3 Foreign exchange trading between (commercial) banks, August 29 (in mln of EUR) 25 2 15 1 5 1.99984 8.8 9.8 EUR exchange rate, August 29 (BGN per EUR 1) 15.8 16.8 22.8 23.8 29.8 3.8 1.95583 1.91182 BNB (comm.) banks from customers 8.8 9.8 15.8 16.8 22.8 23.8 29.8 3.8 interbank (comm.) banks to customers On the interbank market, the BNB purchased EUR 9712.3 million and sold EUR 9685.5 million. The amount of foreign exchange that the BNB purchase from budgetary organisations (equal to EUR 19.1 million), exceeded BNB sales (equal to EUR 9.4 million) by EUR 9.7 million. 17
1 Daily EUR turnover of (commercial) banks, August 29 (EUR mln) 9 8 7 6 5 4 3 2 1 8 8.8 9.8 15.8 16.8 22.8 23.8 29.8 3.8 traded between banks bought from customers sold to customers Daily EUR trading between BNB and banks, August 29 (EUR mln) 6 4 2-2 -4-6 -8 8.8 9.8 15.8 16.8 22.8 23.8 29.8 3.8 spot value - net tommorow value same day value The turnover between commercial banks and customers amounted to EUR 326.1 million. The amount of foreign exchange that the banks sold (equal to EUR 152. 18
million) exceeded their purchases (equal to EUR 156.2 million) by EUR 13.8 million. Non-bank financial intermediaries, licensed by the BNB for foreign exchange trading, purchased foreign exchange equal to EUR 15.7 million and sold foreign currencies equal to EUR 98.1 million. 2 Foreign exchange trading of (commercial) banks with customers, August 29 (in mln of EUR) 15 1 5-5 -1-15 -2 2 15 1 5-5 -1-15 -2 8.8 9.8 15.8 16.8 22.8 23.8 bought from customers sold to customers net Foreign exchange trading of (commercial) banks with nonresidents, August 29 (in mln of EUR) 8.8 9.8 15.8 16.8 19 29.8 3.8 22.8 23.8 29.8 3.8 bought from nonresidents sold to nonresidents net
Foreign exchange market August 29 (in mln of EUR) Purchases Sales Balance Interbank market (commercial banks) 78.3 78.3. (Commercial) banks with customers 156.2 152. -13.8 - of which: with nonresidents 145.6 32.9 112.7 BNB total 9731.5 9696.1 35.4 BNB with banks 9712.3 9685.5 26.8 of which: *with banks - SPOT 91. 9575.5-9484.5 *with banks - TOM 16.5. 16.5 *with banks - TODAY 964.8 11. 9494.8 *with banks - NOTES... BNB transactions with budgetary organisations 19.1 9.4 9.7 BNB notes operations at counters.1 1.1-1. Source: BNB, from banks and BNB s daily reports Currency structure of forex trading: total and for some participants, August 29 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % 1 2 3 4 1-total (BNB, banks, customers); 2-interbank (without BNB); 3-(commercial) banks with customers; 4-forex trading of non-bank financial intermidiaries Others USD EUR 2
Forex swaps and forwards in EUR terms (estimate) FX swap and forward transactions - (commercial) banks with final customers (in mln of EUR) Purchases Sales Balance August 29 1569.3 1851. -281.7 - of which: with nonresidents 1332. 1626.6-294.6 FX structure (percentige) EUR 95.6 96.4 USD 4.4 3.6 Interbank FX swap and forward transactions (commercial banks) (in mln of EUR) Purchases Sales Balance August 29 48.4 48.4. FX structure (percentige) EUR 82.6 82.6 USD 17.4 17.4 The figures for foreign exchange swap deals include both the sales of foreign currecies for BGN and the subsequent purchase operations. Source: BNB, from banks daily reports TENDENCES Short-term expectations: money market rates to remain stable; the indices of the BSE to continue fluctuating following the trend of the leading world stock markets USD/BGN to move within 1.36-1.32. 21