Financial news

Bulgaria’s economy continues to shrink due to the global crisis. The drop of the country’s GDP for the first trimester of 2010 is down by 4% compared to the same period of 2009, show the expert assessments of NSI. Anyway, this result is better compared to the previous three trimesters when the slump of the GDP was respectively 4.9%, 5.4% and 5.9%. In the beginning of 2010, Bulgaria’s economy continues to shrink but the good news is that this happens at slower paces. The positive news is the fact that the drop of the GDP in the first trimester of 2010 is mainly due to the slump of agriculture by 3.4%, while the drop in services and industrial sector is lower - respectively by 2.2% and 1.3%. Bulgaria is in a much worse position compared to the rest of the EU member states.

Bulgaria's fiscal reserve amounted to about BGN 6.6 B at the end of April 2010, the Finance Ministry announced. According to preliminary data and estimates, BGN 6.0 B of the fiscal reserve is at the Bulgarian National Bank (BNB), and the remaining BGN 0.6 B are deposited in commercial banks – including mostly deposits of the National Fund of EU Pre-Accession Programs. Thus, Bulgaria’s fiscal reserve is reported to have grown by BGN 0.2 B, which is primarily the result of the increase of state revenues under the consolidate fiscal program for April. The country's fiscal reserve amounted to BGN 6.4 B on March 31, 2010, including BGN 5.7 B in the BNB, and BGN 0.7 B in commercial bank deposits. The Finance Ministry has pointed out that April is the first month since the beginning of 2010 when state revenues exceeded state is expenditures.

Bulgaria is faced with the serious risk of losing an overall of EUR 131 mln under the Operational Programme (OP) Transport, announced Galina Vassileva, Head of the Programme and Project Coordination Directorate in the Transport Ministry, before the Parliamentary European Affairs and European Funds Control Committee. Representatives of the Ministry submitted to the lawmakers the report on the progress of the operational programme and the situation with the ISPA pre-accession projects. This year and the next one will be critical. Following the N+3 rule for the planned projects in 2007, it turns out that at the end of 2011 we must have absorbed a total of BGN 296 mln. The advance payments, which are not subject to penalty, amount to EUR 165 mln, but the remaining resource is at risk.

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

Companies

According to data for the first quarter of 2010 announced by the Bulgarian National Bank (BNB), Corporate Commercial Bank (CCB) turned out to be one of the most successful Bulgarian banks. The total profit of the Bulgarian bank system fell 37.5% on an annual basis to BGN 170 million, according to the BNB statistics. Only two banks registered a growth in profit – CCB (36%) and UBB (24%). At the same time, CCB is the financial institution that has written off the least bad debts from its credit portfolio – 0.8%. Tsvetan Vasilev, Chairman of CCB’s Supervisory Board, said that about 20-25% (BGN 400-450 million) of the deposits at the financial institution belong to companies partly-owned by the state. He emphasized on the fact, that the bank has granted loans amounting to some BGN 200 – 250 million to other companies in which the state is a shareholder.

Sofia Municipality is close to regaining control over Municipal bank, 25.5% of which are currently owned by companies, related to business tycoon Hristo Kovachki. Municipal company Water Supply and Sewerage has won the suit against such companies that have acquired 2.32% of the bank’s shares in second instance. If the third instance – the Supreme Court of Cassation confirms the decision, the enterprises controlled by Kovachki are bound to lose their quota as shareholders on which all decisions regarding the financial institution currently depend.

Two of Bulgaria’s three mobile operators have signed an agreement to implement the wireless number portability service. Under the agreement the clients of the first and biggest mobile operator Mtel and the third-biggest Vivacom will be able to avail themselves of the service “one-stop-shop”. This allows customers to change their mobile operator with just one visit at the office of the company to which they want to subscribe. The agreement comes into force on August 6. The switch will be done within one week since the client’s application. The news comes days after the Bulgarian communications regulator threatened mobile operators with sanctions for refusing to implement the service. The watchdog said there is a sharp increase in complaints received from clients of the three mobile operators in the country – Mtel, Globul and Vivacom.

Italy’s Lavazza Coffee Shops has wrapped up the takeover of Bulgarian cafe chain Onda Coffee Break, the companies said on Wednesday. The Italian company will pay EUR 6 million for the purchase and investment, the companies said but were mum on the ratio. Onda Coffee Break, whose biggest shareholder is Greek fund manager Global Finance, runs 11 outlets in the Bulgarian capital city of Sofia. Lavazza has more than 350 outlets throughout Europe, Asia and the US but not in Bulgaria. This is the second deal in the sector within less than a year. In end-2009, UK leisure group Whitbread, the owner of coffee chain Costa Coffee, said it has clinched agreement to buy Coffeeheaven for GBP 36 million. Both firms operate in Bulgaria.

Europe

A classified Kremlin strategy paper has said Russia should build better relations with EU countries in order to rescue its economy. But some EU capitals, including Warsaw, are wary of the change in tone. The document, entitled "The Programme for Effective Use of Foreign Policy in the Long Term Development of Russia," is dated February 2010 and written in the name of foreign minister Sergei Lavrov to President Dmitry Medvedev. Mr Lavrov in the preamble says Russia should create "modernisation alliances" with EU states in order to help its petro-based economy emerge from the global financial crisis. The paper highlights France, Germany, Italy and Spain for "priority co-operation." It talks of using the Franco-German "tandem" to help gain approval for new policies at EU level. It also speaks of developing the Russia-EU-US "triangle" to gain respectability on the world stage.

America

If you can't fight the federal government, you may as well pay 'em. Especially if you're Goldman Sachs. In recent days, Wall Street has been abuzz with speculation that Goldman attorneys have entered preliminary talks with the Securities and Exchange Commission with the hopes of settling the outstanding federal fraud charges now facing the company. Executives at the New York City-based investment bank have offered similar hints. A settlement with the SEC would likely bring to an end at least some of the negative publicity Goldman has had to endure since regulators charged the company and one of its employees with defrauding investors in the sale of a complex mortgage investment dubbed "Abacus."

Asia

An official with the Ministry of Commerce said China will conduct consultations with the European Union on the steel fastener trade dispute in line with the rules of the World Trade Organization disputes settlement system. The official said China antidumping investigation into carbon steel fastener imports from the EU was based on Chinese regulations and the assessment of the harm to the domestic industry. The remarks came after the EU filed a complaint against China at the World Trade Organization over Beijing decision to impose antidumping measures against carbon steel fastener imports which included self tapping screws, bolts and gaskets.

Panagyurishte Golden Treasure

The Panagyurishte Golden Treasure is a rare archaeological monument from the Hellenistic Age and one of the symbols of the Panagyurishte region. It was found near the Mramor hillock in 1949 during agricultural work. It consists of nine richly adorned vessels - an amphora, seven rhytons and a phial. It weighs 6.164 kg. The largest vessel is the amphora, which has a centaur-shaped handle. Three of the seven rhytons are shaped as animals' heads, one is the front part of a goat, three have women's (Amazon) heads. The set most probably served for the drinking of wine in a religious, celebratory or domestic atmosphere. There is also an opinion that its purpose was the ritual purification of a liquid, which could be wine. It is supposed that another two rhytons with the front part of animals, an amphora and one or two phials are missing, with a view of the sacral importance of the number three in the Thracian religion. There exist two basic hypotheses about the origin of the Panagyurishte Treasure. They are based on the carved letters on some of the vessels, which are considered to signify the measure units of the gold. According to a widespread thesis, the signs belong to the metric system used in the Asia Minor town Lampsak. Other scholars however have discovered that a similar system was used in the interior of Thrace, so there is a possibility of the treasure's local origin.

On that day:  Lopushanski monastery