Financial news

Five of the banks operating in the country have attracted 77% of household deposits in the last 12 months. Leaders in this regard are UniCredit Bulbank and First Investment Bank, whose deposits recorded a growth of over BGN 1 billion- BGN 1.522 billion and BGN 1.119 billion respectively. Savings of Central Cooperative Bank and SG Expressbank have grown by more than BGN 800 million. Top five of the ranking is completed by DSK Bank, followed by Raiffeisenbank, Invest Bank, International Asset Bank, CIBANK and Allianz Bulgaria, which together with Bulgarian-American Credit Bank and Piraeus Bank added BGN 100 million new deposits. Reflux of new funds in the period is reported at Alfa Bank (BGN 257 million less), Postbank (BGN 181 million less), ProCredit Bank (BGN 171 less) etc. At the end of the third quarter of 2015 household deposits in the country were BGN 42.984 billion as compared to BGN 42.48 billion about three months ago and BGN 36.79 billion a year ago.

Energy and Water Regulatory Commission (EWRC) Chairman Ivan Ivanov said that, for the time being, there is no reason to expect an electricity price hike due to the problems with the future loans to be taken out by the Bulgarian Energy Holding (BEH). The government's refusal to provide a guarantee for the BEH loans should not push up the electricity price for now, "but we will watch the situation." The loans are partly intended to finance a debt settlement between the National Electricity Company (NEK) and the AES Maritsa Iztok І  and ContourGlobal Maritsa East 3 as a condition for revising the plants' long-term electricity sale agreements with NEK, which will help NEK reduce its financial deficit.

	Mineral Fuels, Tailoring Products, Canning, Perfumery and Cosmetics, Furniture, Meat Products, Wine, Wood-processing Industry

Companies

Double increase is sales since July and start of equipping its own factory in Ruse. That is what Bulgarian start-up Creō has achieved since its establishment in May this year. The company develops, manufactures and sells innovative paint, which allows write with a marker and then rubbing the written with a sponge on each and every wall. Creō recently received funding from the second accelerator Eleven, which is at least twice as great as the first assessed to EUR 25 thousand back in May. Now the company is negotiating with other funds and investment angels. Its goal is to raise EUR 200 thousand for its further development. Creō is paint that after application allows any smooth surface to be used as a writing board with marker. It is available in many different colors, including transparent, it can be even dull. Contrary to initial expectations of the team to have the product in schools and kindergartens Creō is greatly demanded for office space. So far, Creō painted over 800 square meters in one of the largest office buildings in Bulgaria, where tenants are companies like Telerik, VMware, SAP, Skrill and Fox. Still the activity of the start-up is concentrated in Sofia as the team tries to offer the service of painting as well. Soon, however, the company intends to cover other major cities - Bourgas, Varna and Plovdiv. For next year the start-up has the ambition its innovative paint to cover 5 thousand square meters of offices in Bulgaria and the company's turnover to reach about BGN 250 thousand.

Deal for purchase of Alfa bank’s branch in Bulgaria from Postbank will end in a matter of days. In October bank authority issued needed permit. At present process of terminating the deal is going on. Now Postbank is sixth in terms of assets, while after the merger it will become fifth, if financial results for the three quarters of the year are taken into consideration. After merger is completed there will be three banks in Bulgaria whose mother companies are Greek. These are Postbank, United Bulgarian Bank and Piraeus. Last year the European commission approved plans for restructuring of the fourth basically important banks in Greece, each one of which has a branch in Bulgaria. The latter envisages in general terms separation with strategic assets and focus on banks’ core markets. The sale of the branches of Alpha Bank in Bulgaria to Postbank is the first such deal for the local market. After the deal Postbank will accept all the banking activities of the branch of Alpha Bank, which at the date of announcement of the transaction had a total value of BGN 500 million, as well as loans for more than BGN 800 million.

Bulgarian power tools manufacturer Sparky Eltos launched a new production line, one of the banks which has financed the investment project said. The Bulgarian Development Bank (BDB) has backed the project alongside the International Investment Bank with a EUR 10 million syndicated loan, where BDB contributed EUR 3 million. The investment will open 180 jobs in the company's plant in Lovech, in north-central Bulgaria, and will create prerequisites for production and sales growth and access to global markets. BDB is a state-owned financial institution focused on supporting small and medium-sized enterprises.

Over 1100 students from all over Bulgaria participated in the first meeting of the initiative for students – “Children’s Academy of Telerik,” “School Academy of Telerik” and “Algo Academy of Telerik” in October, announced by Telerik, a Progress company. For the academic year 2015-2016, more than 440 new students aged from fourth to sixth grade have passed entrance exam and was accepted in fifteen schools of the “Children’s Academy of Telerik” in 10 cities in the country. They are trained in two training areas – “Algorithmic Programming” and “Development of computer games.” In the first area children learn to solve problems with algorithms to create programs at the same time prepare for national competitions in informatics. In the second strand students step by step create games with HTML, CSS and JavaScript, while developing basic skills in programming. More than 200 students from across the country attended the October training “School Academy of Telerik” in Sofia and another 370 have joined online. The next meeting of “Algo Academy of Telerik” will be in November. As with other initiatives, participation is free with pre-registration. “

MMD, license partner for monitors Phillips and AOC signed a contract with PolyComp for distribution of the full range of monitors from both brands. “We aim to achieve the highest market share of Philips and AOC monitors in Bulgaria.” Said Martin Lechev, sales manager for MMD in Bulgaria, Macedonia and Albania. “The new contractual relations with PolyComp will help us reach an even greater number of professional users and corporate clients. Philips monitors AOC and accepted well by the Bulgarian market for avant-garde design and innovative features, so the demand is growing,” he added. Philips and AOC monitors are already in stock at PolyComp and can be ordered from dealers, reported from MMD.

IndustryMatchMaking 2016 - IMM2016, Business and technology matching event

Europe

European Central Bank President Mario Draghi defended the central bank’s readiness to take more accommodative action to fight the risks of low inflation in the currency bloc.The ECB head said its asset-purchase program was proceeding smoothly, but underscored the central bank’s willingness to do more. The comments come as inflation in the eurozone is flat and isn’t expected to approach the central bank’s medium-term target of just below 2% for quite some time. Mr. Draghi signaled at his news conference last month that the central bank may expand its large-scale bond-purchase program and could also lower the rate on overnight deposits further into negative territory, meaning that banks would have to pay more to store surplus funds with the central bank. In March, the ECB launched a €60 billion ($66.1 million) a month bond-buying program that it intends to run until at least September of next year. The ECB’s deposit rate is currently -0.2%. Mr. Draghi said, however, in a weekend interview in the Italian newspaper, Il Sole 24 Ore, that it remained an “open question” whether more stimulus would be needed at its next meeting in December. This comment and others from hawkish members of the Governing Council have led some analysts to suggest that the outcome for December isn’t quite as clear as was once assumed.

America

General Electric Company (NYSE:GE) has completed its acquisition of Alstom power and grid business after the final approval from European Union. The transaction took place after regulatory approvals from 20 countries. It is considered as the largest industrial acquisition by the firm. The agreement initial worth of EUR 12.35 billion was inked in 2014 that was finally settled at EUR 9.7 billion, after incorporating certain adjustments. The acquirer has to set up a joint venture in renewable energy, nuclear power, and electricity grid equipment in France. The approval is big news for the company, as it had earlier faced decline from the EU in the case of Honeywell acquisition deal. GE expects to produce earnings per sell (EPS) in $0.05-0.08 range from it in 2016. The acquisition reflects the company’s ambition to excel towards industrial sector. GE will find itself in better position in steam turbines that are used in gas-fired, coal-fired, and nuclear-power plants, as well as in power-grid equipment. “GE Digital” has been formed to consolidate all digital capabilities across the company, in order to provide customers with the best industrial solutions and software. The acquired entity is named as “GE Power” and is comprised of Alstom’s power & water unit.

Asia

Japanese Prime Minister Shinzo Abe instructed the government to come up with an action plan by the end of the month to help achieve his goal of expanding the economy by a fifth to 600 trillion yen ($4.95 trillion) over five years. Abe hopes that the measures should encourage Japanese firms to spend their record cash piles to boost investment on plants and equipment and raise wages in a bid to generate a cycle of growth led by the private sector. "In order to achieve the biggest GDP in the postwar era, the business circles need to tackle capital spending and wage hikes. The government will quickly consider steps to support it," Abe told a meeting of his top economic advisory panel. "I want (Economics) Minister (Akira) Amari to compile urgent measures needed to realize GDP worth 600 trillion yen." The four private-sector members of the 11-member Council on Economic and Fiscal Policy reckon that Japan needs a potential growth rate of around 2 percent to meet Abe's GDP target. Currently, Japan's potential growth rate is around zero due to decades of economic stagnation and a declining population, making achieving 2 percent a tough task. Some economists say Abe's GDP target is unrealistic given that nominal GDP was only 491 trillion yen at the end of last fiscal year.

Birthday of Executive Chairman of BIA

Today is the birthday of the Executive Chairman of the Bulgarian Industrial Association - Bojidar Danev.

The team of Business Industry Capital would like to wish him good health and best of luck!

On that day:   Musala summit – Rila mountain