On October 5, 2022, in the presence of officials and guests, an anniversary conference was held on the occasion of 140 years since the beginning of insurance in Bulgaria and 30 years since the establishment of the Association of Bulgarian Insurers (ABI). The prestigious event is organized by ABI, a long-standing partner of the Financial Supervision Commission (FSC).

The conference was opened by Mr. Konstantin Velev – Chair of the Board of ABI, Mrs. Daniela Dobreva – Deputy Minister of Finance and Mr. Boyko Atanasov – Chair of the Financial Supervision Commission. Leading figures of European insurance were also present – Mrs. Petra Hielkema, President of the European Insurance and Occupational Pensions Authority (EIOPA), Michaela Köhler – Director General of the European Federation of Insurers Insurance Europe and Didier Millero – Head of the Insurance and pension insurance Sector in the Directorate General „Financial Stability, Financial Services and Capital Markets Union“ of the European Commission.

Mr. Velev set the highlights of the conference – regulations, competitiveness and the growing climatic, demographic and digital risks of the modern age, as well as the search for appropriate protection against them.

In her speech, the Deputy Minister of Finance – Ms. Daniela Dobreva emphasized the successful partnership of the Ministry of Finance with the FSC and the ABI, as „the goal is to increase the protection of users of insurance services, guarantee financial stability and preserve the competitiveness of Bulgarian insurers“.

The Chair of the FCS – Mr. Boyko Atanasov welcomed the participants and shared that „the role of the Association of Bulgarian Insurers is to be a pillar of security, a balancer for diplomacy, a visionary for conquering new horizons. I believe that the words that best describe our joint work with the insurance sector in Bulgaria are dialogue, technological orientation and cause“.

The Financial Supervision Commission will continue to support the insurance industry and work to achieve a smooth implementation of the new regulations affecting this sector in the country. As of the first half of the year, it represented 3.9% of GDP calculated on the basis of gross premium income (insurance penetration), and 8.2% calculated on the basis of insurers’ assets (2021 data). For the first six months of 2022, Bulgarian insurers realized gross premium income in the amount of BGN 1.7 billion, taking into account an increase in written premiums of 11%, and for the same period benefits were paid in a total amount of BGN 684 million , with the same growing by 10% on an annual basis.

The cited data are an indicator of a stable insurance market, which is a prerequisite for a higher level of competitiveness and at the same time for maintaining confidence in it. Innovation is about to be created and introduced, with the potential to position insurance companies and their customers at another level.

During the conference, Mr. Vladimir Savov, Deputy Chair of the FSC, Head of the Insurance Supervision Department, took part in the discussion part of the panel „Insurance Market: Regulations and Competitiveness – in Search of the Balance“. Topics fundamental to insurance were discussed and effective policies were outlined to stimulate the development of the sector, with all the resulting benefits for the economy and society.

On December 6, 2022, the Association of Banks in Bulgaria (ABB) gathered prominent representatives of the financial sector on the occasion of Banker’s Day. The official event began with a conference, which was opened by Mrs. Diana Miteva – Chair of the ABB Board of Directors.

The first panel of the conference – moderated by Mrs. Miteva, with participants – Radoslav Milenkov, Deputy Governor of the Bulgarian National Bank, Boyko Atanasov, Chair of the Financial Supervision Commission, Lyudmila Petkova, Deputy Minister of Finance, was dedicated to the new realities – macroeconomic factors and regulatory environment.

The Chair of FSC congratulated the banking community on the occasion, sharing his belief that the banking and non-banking sectors are actually 2 sides of the same coin in the equation of the new economic reality.

“Regulators must place emphasis on those regulations that enable businesses to make informed and ethical decisions in a changing environment. We must create new principles that are relevant in the new reality. The understanding is that the regulators are the anchor of the sailing ship is incorrect, we are the compass that protects it from hitting underwater rocks, we are partners of businesses and investors. My vision for FSC is not one of hibernation, but rather a proactive strategic position in which to look for challenges, both at the macroeconomic level and at the operational business level. I believe that regardless of the new economic reality and geopolitical situation, today we all declare our willingness to work together for the stability and future of the Bulgarian economy, upholding the global digitalization, the European Green Deal and the upcoming entry into the euro area- trends that provoke us to be united in order to be sustainable, on the one hand, and on the other – to boldly face any change,” he stated.

According to him, the biggest challenge is undoubtedly the introduction of the euro, on which the future of the Bulgarian economy and life in the country depends. Leading among other challenges are financial innovations, which can position the capital market at a new level, but also must be carefully introduced. The Chair of FSC also shared that “we ourselves are actively working for the digitalization of the Financial Supervision Commission – reducing the administrative activity for the supervised persons, so that Bulgaria is a place where it is easy to do business“. He announced the launch of a mobile application of the FSC within days, for the convenience of users and supervised persons.

After the adoption of the new regulations, the Financial Supervision Commission will have the important task to create regulatory certainty and increased operational resilience of digital technologies in the financial sector by encouraging the development of innovation, but also by continuing to maintain a secure environment for optimal, but above all secure user experience.

The second panel was dedicated to “Looking ahead – banks and their clients” with the participation of Atanas Pekanov, Acting Deputy Prime Minister for the Management of European Funds, Tsvetanka Mincheva, Deputy Chair of the Board of Directors of ABB and Miroslav Vichev, CEO of Borika AD.

The conference was followed by a celebratory cocktail on the occasion of Banker’s Day.

The Financial Supervision Commission – with a commitment to stable results in a time of digitalization, green investments and regulatory changes

  In the context of the post-Covid pandemic, global digitization, the European Green Deal, the hostilities in Ukraine and on the threshold of the euro area the Financial Supervision Commission continues to work for stability of the insurance market in Bulgaria, to introduce innovations in the regulation of the capital market, as well as ensure absolute strictness and complete transparency of the actions and processes of the pension insurance market.
The development trend of the capital market is headed towards digitization and creation of conditions for more participants and reduced administrative burden. The positive relationship between innovation and financial technology has already reshaped standard consumer behavior and thinking, and this process has led to new opportunities for realizing optimized business models. At the same time, we, the participants in the financial sector, have the task of analyzing and forecasting potential risks. It is in this direction that the FSC focuses its activity on the balance between the promotion of innovation on the part of companies for investment purposes and the protection of consumers from the negative aspects that the new online space implies.
In order to achieve results with the set development strategy, the Financial Supervision Commission has passed through specific steps such as the development of financial literacy of users of financial services and investors, improving the communication process by conducting regular meetings with FinTech companies to discuss minimal risks and maximum benefits from technologies, promoting the development of start-up companies by activating the capabilities of the Innovative Hub, as well as adapting the new regulatory framework for crowdfunding. Together with the participants in the non-banking financial sector, we create a sustainable and innovation-friendly business environment, with an emphasis on the need for a partnership between the national regulator and business.
Dynamics in the development of technologies and digitization have a key role in changing consumer attitudes and growth expectations. The role of the FSC is to provoke the sync between the regulatory requirements and their implementation in a digital environment, with the ultimate goal being to reduce the administrative burden. Part of the specific results are the functioning Innovation Hub, providing a single point of contact with FinTech companies and the changed regulations for access to the capital markets of small and medium-sized enterprises. The FSC mobile application, building a unified information system for submitting and receiving information from supervised persons in an electronic standardized format is also in progress.
An interesting moment in the current situation is that, within the framework of integrating innovations to reduce the administrative burden, the European Commission presented a Proposal for a Regulation of the European Parliament and the Council establishing a European single access point (ESAP). Its purpose is to provide the public with centralized access to all necessary information relevant to financial services. The European single access point will give investors easy, fast and comparable access to data on European companies, thereby also facilitating access to financing for European companies. ESAP is expected to contribute to the further integration of financial services and capital markets in the EU single market and to promote the development of smaller national capital markets and economies by providing greater visibility to them.  The Financial Supervision Commission, in sync with the European Commission, introduces measures to implement the new regulations and creates conditions for the realization of the vision of a European single access point.
Certainly one of the extremely meaningful and cause-oriented topics is that of the “Green Deal”. Ecology, social responsibility and transparent management are already part of the worldview and way of thinking of institutions and regulators in Europe. In accordance with the objectives of the European Union, the Financial Supervision Commission in Bulgaria supports through specific actions the targeting of national and European funding towards a sustainable economy, the planning of tools for business recovery after crises, as well as the balanced regional development of the country. I believe, and I see the specific results, that the Bulgarian regulator in the non-banking sector strategically arranges its actions in support of achieving the goals of the “Green Deal”. In this line of thinking, we all as a society are tasked with turning our attention to renewable energy, energy efficiency, green buildings, clean transportation, products created by the circular economy. After the adoption of the European Green Deal, the focus of the FSC will be on financial risks for institutions and the financial system, as well as on sustainability risk (ESG risks).
When we talk about achieving sustainable goals, examples are always important. Green bonds are a suitable financial instrument for large-scale sustainability projects, by giving access to a robust financing tool for green projects compliant with the EU taxonomy. On the other hand, investors in such bonds will be able to more easily assess and compare the sustainability of their investments, which will reduce risks and strengthen their confidence in the market. The new EUGBS voluntary standard will be open to all EU and non-EU issuers, including corporations, financial institutions and issuers of covered bonds and asset-backed securities, as well as governments and other public bodies.
In this regard, the challenges to the FSC to exercise its supervisory powers over capital market participants in compliance with the requirements laid down in the legislative package for Sustainable finance, namely the Disclosures Regulation, the Climate and Sustainable Finance Benchmarks Regulation and the Taxonomy Regulation.
The FSC is also a major participant in the process of creating the National Plan for the Introduction of the Euro in Bulgaria. The FSC’s vision for this key process for the Bulgarian economy , includes the systematization of the necessary measures and actions in connection with the conversion of financial instruments. We intend to carry out the necessary monitoring of the expected stages for the adaptation of the clearing and settlement systems to work with the euro.
In the context of the complicated international situation caused by the war in Ukraine and the sanctions and restrictions imposed by the EU, USA, Canada, the UK against the Russian Federation, the Russian Central Bank, credit institutions and companies, as well as individuals, the Commission took timely measures such as issued recommendations and guidelines to the investment, insurance and insurance sector for increased caution and the implementation of a strengthened risk management policy before proceeding with investments in financial instruments issued by issuers related to the Russian Federation.
The challenges we face provoke us to be vigilant, focused on achieving the set goals of increasing consumer protection, as well as promoting investors, of a stable, regulated and transparent non-banking sector.
Amid this global transformation, the FSC is starting a new strategic period for 2022 – 2024. The change for the regulator includes long-term planning, a strong expert team and determination to implement innovation in the field of digitization and regulations to stimulate the capital market. All this will be accompanied by constructive dialogue with all stakeholders in the processes regulated by the FSC. An important part of the development of the Bulgarian capital, insurance and social insurance market is the active and effective communication with businesses in the direction of developing concepts and sustainable strategies. Our goal is to be predictable in our actions and to show objectivity when making decisions on which the development of Bulgaria depends.