The Foreign Banking Sector in the Wake of Globalization. Evidence from Bulgarian Banking Market

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Author	Dr. Stamatis Kontsas, Professor Anastasios Alexandridis
ISSN	2307-2466
On Pages	516-520
Volume No.	2
Issue No.	7
Issue Date	December 01, 2020
Publishing Date	December 01, 2020
Keywords	Financial liberalization, privatization, market

Abstract

Some of the countries (Romania, Bulgaria) in the South East European region are still in a process of transition from a planned economies to capitalist market economies. This transition is accompanied by modernization and convergence needs. Part of the structural reforms was the privatization process. Especially in some sectors, such as the banking sector in Bulgaria, more than 75% of the industry has already been sold to foreign financial institutions (BNB, 2006). Seen from on perspective one side this fact creates sense of financial stability, which was of the greatest concern during and after the three observed banking crisis in 1994-1997 's. On the other hand, questions arose of whether the domestic capital has now difficulties to be profitable in financial banking operations. However, by reducing the uncertainty and reaching a proper level of price stability through stable financial system, Bulgarian authorities were successful, so far, in creating environment where predictability is a fact. Concentration levels in a financial sector are moderately high. Despite the predictions for further consolidations there is room for arguments that new comers could be observed at the market. In this respect, question of whether domestic banks could grow and to be competitive to the international financial rivals in Bulgaria, is considered as a potentially interesting area of research.

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