Financial news

The inflation in Bulgaria stood at 0%, sccording to the latest figures of the National Statistical Institute (NSI). The index of consumer prices in May compared to April was 100%, which accounted for a monthly inflation of 0%. Since the beginning of the year there has been deflation of 1%, while compared to May last year, deflation has stood at 2%. Compared to April, there was increase in the prices of food products and soft drinks, alcohol beverages and tobacco products, clothing and shoes, healthcare and transport. In May, the prices of education and housing and utility bills retained their levels from the previous month. There was decrease in the prices of furniture, domestic appliances and home maintenance, communications, entertainment and culture, restaurant and hotel services. In May, the prices of the following food products increased: flour, pasta, minced meat, yellow cheese, fresh fruits, cucumbers, potatoes, carrots, garlic, lentil, sugar, non-chocolate sugar products, coffee, ice cream, baby foods, carbonated drinks.

An average of BGN 173.30 was drawn from ATMs, shows statistics of operator Borica for 2015. The average value of the transaction at POS terminal was BGN 64.2. Last year the system for card payments saw transactions for BGN 171.89 million, which is nearly 10% more than in 2014. For comparison - in 2006 these transactions were BGN 92.6 million. Carryovers in 2015 were worth BGN 18.845 billion, an increase of 15.4%. During the year were made 77 million transactions from ATMs totaling BGN 13.347 billion, which is 5.5% more than the previous year. Payments for goods and services at POS were 54.5 million totaling BGN 3.504 billion, an increase of 17.4% compared to 2014. The total interbank payments for the year were 65.4 million, which is 8% increase as to 2014. The average transfer was worth BGN 1955.70. This year Borica will work to build a center for centralized monitoring of all card transactions in the banking system.

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Companies

Bulgaria will be able to receive up to three million cubic metres of natural gas from Greece daily. This becomes possible after the modernisation of the compressor station in the town of Petrich, which was unveiled officially on Monday. The investment, which has been funded by the EU, amounts to EUR 17 million and is expected to make Bulgaria more independent in terms of its energy supplies. Through the modernized compressor station Bulgaria will be able to receive a third of its energy supplies from Greece. Bulgartransgaz will complete an inter-operator agreement with the Greek network operator which will provide opportunity for also virtual trade in gas. At present Bulgaria’s annual consumption of gas is slightly above 3 billion cubic metres. Thе reconstructed compressor station provides the first opportunity for diversification of Bulgaria’s gas supplies and there is possibility for connection with the liquefied natural gas (LNG) terminal in Thessaloniki.

Fitch Ratings has affirmed the long-term issuer default ratings (IDR) of Allianz Bank Bulgaria, Societe Generale Express Bank and Sogelease Bulgaria at BBB+ as well as ProCredit Bank's rating at BBB-. The outlooks of the ratings of the three banks and one leasing company are stable. It also affirmed the banks' viability ratings (VR). The affirmation of the IDRs of the three banks and Soglease reflects Fitch's opinion of a high probability that they would be supported, if required, by their respective parents. The affirmation of viability ratings reflects no major changes in their financial metrics over the last 12 months. ABB's ultimate majority shareholder is Allianz SE through a 66% stake in Allianz Bulgaria Holding, a direct 99.9% owner of ABB. PCB is 100%-owned by ProCredit Holding AG & Co. SGE is a 99.7% subsidiary of Societe Generale, while Sogelease is SGE's 100% subsidiary. ABB's IDRs reflect a high probability of support from Allianz due to the parent's strong credit risk profile and ABB's relative small size.

Bulgaria-based Euroins Insurance Group (EIG), a subsidiary of Eurohold Bulgaria, is looking for acquisitions in key central European markets, like the Czech Republic and Poland, as part of its strategy to become a leading insurer in eastern Europe, Asen Christov, Eurohold Bulgaria's chairman said. "Along with strengthening the group's position in the insurance market in Southeastern Europe, we are foreseeing expansion in Central Europe - Czech Republic, Poland. Our goal is to make Euroins Insurance Group the biggest independent insurance player in Eastern Europe," Christov said. Presently, Euroins operates in Bulgaria, Romania, Macedonia, Greece, and Ukraine and hopes to expand into central Europe in the short to medium term. "Acquisitions are part of our way of life and help us diversify and improve the quality of our insurance portfolio in order to increase the share of the non-motor segments and achieve a more precise and detailed segmentation," Christov added. In July 2015, EIG bought Greek life insurer Credit Agricole Life.

80 new jobs will create American company in Dobrich. At the 15th of June a new distillery for essential oils, which will be one of the biggest in Bulgaria will be officially inaugurated. Investment is assessed to more than BGN 5 million and is made by Bulgarian subsidiary Esseterre Bulgaria. The mother company doTERRA is based in Texas, the US. Esseterre Bulgaria handed out papers for construction of the facility in the end of November and beginning of December 2015. The next stage envisages investors to start production of essential oils by themselves.

Bulgaria's Asarel Panaguyrishte Zdrave, majority-owned by copper mining company Asarel Medet, opened an оncological hospital in Panagyurishte, in southern Bulgaria, following a BGN 90 million upgrade of an existing hospital. The 310-bed Uni Hospital will employ highly-qualified staff in 36 medical specialties. Uni Hospital's majority owner with a 90% stake is Asarel Panaguyrishte Zdrave, with the remainder held by the municipality. For its part, Asarel Panaguyrishte Zdrave is 67%-owned by Asarel Medet, a 28% stake is in the hands of a locally-registered company - Business Sustainable Development 06, and 2.7% are controlled by the Panagyurishte municipality. Asarel Panaguyrishte Zdrave and the Panagyurishte municipality plan to invest a further BGN 5-7 million in a centre for robotic surgery with the hospital by the end of the year.

Europe

FCC owns real estate assets worth EUR 328 million. The company controlled by the Mexican tycoon Carlos Slim is working on the sale of all of its assets located in Spain, which include housing developments, land/estates, garages and other premises. Not in vain, in the last year, FCC has strengthened its team in the real estate division, whereby converting it into a sort of real estate agency. Nevertheless, far from withdrawing from the real estate market, the Spanish multi-national wants to take advantage of the recovery in the sector to combine the construction of homes with their promotion and whereby open a new line of business. Under the leadership of Xavier Fainé, the former CEO of Cementos Portland, FCC Real Estate is looking to generate value from its real estate assets by proceeding with their orderly sale. The progressive, albeit slow, recovery of the market in Spain and the positive outlook is helping with this task – house sales grew by 9.2% during the first quarter of the year, although the figures are still 56.9% below those registered in 2007 -. Sources at the company indicate that the real estate assets belong to FCC Construcción “and they are administered from there”.

America

Shares of LinkedIn Corp. jumped nearly 50% on Monday morning after the company said Microsoft will buy it in a $26.2 billion deal that would merge Microsoft’s enterprise cloud services with the professional social network. The all-cash transaction amounts to $196 a share, a 50% premium to Friday’s closing price. Excluding Monday morning’s rally, LinkedIn shares had been up 14% over the last three months but down nearly 40% over the last year, underperforming the S&P 500. They are still down 14% in 2016. Jeff Weiner will remain CEO of LinkedIn reporting directly to Microsoft CEO Satya Nadella. The deal is expected to close later this year, pending regulatory approvals. Both company’s boards have unanimously approved the acquisition. The acquisition is Microsoft’s largest under Nadella, who became CEO 2014. Microsoft said it expects to keep LinkedIn’s brand and independence, but will work to integrate the professional social network with Microsoft Office 365 and Dynamics, its customer relationship management offering.

Asia

China does not want a trade war with Europe, Premier Li Keqiang said on Monday at a news briefing with German Chancellor Angela Merkel, who called for more talks with Beijing on its market economy status under the World Trade Organisation. Beijing sees Germany, China’s largest trading partner in the European Union, as influential in the 28-member bloc’s debate on the politically sensitive issue of its market economy status. China agreed when it signed up to the World Trade Organisation in 2001 that some countries could use often advantageous third-market comparisons when determining if Chinese imports were being sold at cut prices. That provision is set to expire automatically in December, but anger persists over Beijing undercutting foreign industries with its heavily subsidised goods, particularly with massive overcapacity in Chinese sectors such as steel. China is adamant that countries must abide by the deal struck 15 years ago, but reluctance in Europe to give up a method to defend against cheap Chinese imports has set up a looming dispute at the WTO and the prospect of broader trade friction.

The Baba Vida Castle

The Baba Vida castle is one of the greatest historical monuments, located in the north-east part of Vidin on the curving bank of the Danube river. The foundations of the medieval castle, which is the only completely preserved military fortification in Bulgaria, were laid in the 10 century, on the remains of the Roman castle of Bononia. In 12-14 it was residence of the boyars Rostislav, Yakov Svetoslav, Shishman, and king Ivan Sratzimir. Nowadays, it stretches on an area of 5 decares and consists of 2 walls, forming an inner court yard. The area, enclosed by the inner wall, is laid with adjacent vaulted premises, which surround a small inner court yard. In 1964, the castle was declared a historical monument of national significance. According to one of the legends, the Baba Vida castle was built by one of the daughters of a powerful Bulgarian boyar, who owned large domains from the Carpathians to the Balkan. After his death his three daughters, Vida, Koula and Gamza, divided the domains among themselves. The two younger sisters, Koula and Gamza married hastily.They choose bad men, who carelessly wasted their father's heritage. The eldest sister, Vida stayed single all her life. Under her leadership a castle was built up. She lived in it up to a ripe old age, successfully defending her subjects from hostile assaults. As a sign of gratitude, people named the castle after her name when she died - Baba Vida or The Towers of Baba

On that day:  Plamen Konstantinov Ibisha Island