Non-performing loans (NPL) in Bulgarian banks rose at the end of September, according to supervisory data from the Bulgarian National Bank (BNB). Corporate loans and those for households, overdue for more than 90 days, have reached nearly BGN 2.45 billion (EUR 1.25), with their share in the total loan portfolio growing. Their quarterly growth rate is 4.75%, while the annual growth exceeds 6.6%.

The only overdue loans with a decrease are mortgages – overdue loans have fallen by 6% over three months. Non-performing housing loans account for just 0.36% of the mortgage portfolio of Bulgarian banks, continuing the trend of decline.

Performance of the other types of loans are worse – household consumer credits and corporate ones have increased both on a quarterly and annual basis, but the growth compared to September last year is very weak for corporate loans (see the chart). Consumer loans remain the ones with the largest share of overdue payments in the banks’ portfolios and the highest increase.

In recent years, several banks have transferred their consumer lending to non-banking companies within the same economic group. However, the BNB statistics do not include them in the supervisory reports, but rather in those for non-bank lending. There is no surprise with mortgages – despite experts warning for years about too rapid growth and risks in the real estate market, this has not affected either the volume of loans granted or their ability to be paid.