Best bank:
Bulbank
Best debt house:
Citigroup/Schroder Salomon Smith Barney
Best Equity House:
not awarded
Best M&A House:
CA IB, CSFB (joint award)
Bulbank has long been dominant in the Bulgarian market. But its sale to Unicredito and Allianz in October last year also put the bank in the top league for quality service. The new owners have a clear strategy for the region and have shown that they can turn state-owned institutions into dynamic and efficient banks. Accordingly, Bulbank has started to improve its asset structure and organization.
Particular emphasis has been puton the development of risk management and retail banking, where it comes second in market share only after the State Savings Bank.
As the former foreign trade bank, set up in 1964, Bulbank is undisputed leader in corporate banking. So far banks have preferred to invest in treasuries, but over the past year the economic environment has improved considerably, credit applicants have become more sophisticated and so lending activities have picked up.
As part of its restructuring programme Bulbank has also embarked on a financial plan, which aims at return on equity of 25% in three years. Last year’s ROE of 29% was exceptional because of the sale of Bulbank’s shares in Corporate Commercial Bank (99.9%), United Bulgarian Bank (35%) and in HypoVereinsbank Bulgaria (49%). Its ROE in 1999 was 14%.
In July 2000, Citigroup arranged the biggest syndicated loan and first structured finance deal in Bulgaria. The $77million state-guaranteed loan is part of a $380 million credit arrangement for modernizing the Kozloduy nuclear power plant. US bank Rosseximbank guaranteed the loan which, says Citigroup, could be a blueprint for similar structures to follow. Citigroup also provided financing to the Bulgarian telecommunications company and Bulgartabac.
Citibank opened the first branch last July and has taken the lead in electronic banking, which is used by 57% of the bank’s customers.
Bulbank’s privatization was, at e360 million, the largest privatization ever undertaken in Bulgaria. CA IB and CSFB advised the government on the sale of the Bank Consolidation Company’s shares of Bulbank to UniCredito Italiano (93%) and Allianz (5%). CA IB was involved in the initial work, which started in 1998. The Kosovo war prevented the bank being sold as was initially planned at the end of 1999.
