Bulgarian employers will freeze or raise only modestly salaries in 2009, showed a Dnevnik poll of HR agencies.

Unlike in previous years, none of the polled forecast the precise movement of wages next year as employers have not yet gauged the damage the stagnation spawned by the global financial crisis has done on their performance.

The tight economic conditions will make managers wary of every move, and the double-digit growth in wages of the previous years will be a thing of the past.

Data by Monday HR agency showed that an average pay rise of 20% would be exotic.

ConsulTeam forecast the humble growth in wages will roll over to 2010 and hinge on macroeconomic and market factors as well as corporate results.

AIMS Human Capital Bulgaria says it is hard to tell in the current situation what will happen to salaries next year.

Only Hay Group projected companies will press ahead with the planned 12% average pay rise.

Employer unions reinforced the trend towards cutting wage costs.

The crisis made “pay rise” a bad word people should forget, commented Evgenii Ivanov, executive director of the Confederation of Employers and Industrialists in Bulgaria.

Bulgarian Industrial Association chairman Bozhidar Danev also called on managers to think twice about upward revision of salaries.

Representatives of metallurgical and textile makers, who were the first to feel the pain of the crisis, said pay rises are not on the agenda given the current stagnation.

Employers say their top priority is keeping jobs.

(Dnevnik)

The assets of Bulgarian banks dipped 1.1% to BGN 68.6 billion in October compared to September against the backdrop of the global financial crisis, central bank data showed.

Year-on-year growth slowed down to 28.9% in October from 33.6% in September.

Foregn bank branches broke ranks with rivals posting a rise in assets, the central bank said.

However, the top five lenders held their ground on 57.8% of the market combined.

Fluctuations on the global financial scene changed also the behaviour of customers, whose savings with banks slumped to BGN 60.1 billion in October from BGN 60.9 in end-September.

Household deposits dropped by BGN 349 million to just over BGN 21.8 billion, while companies deposited BGN 19.3 billion, which is BGN 924.5 million less than the previous month.

Attracted resources from credit institutions added BGN 133.6 million.

In spite of the decrease, deposits of individuals retained their lead as banks’ biggest source of funding accounting for 36.3% of the total volume of attracted resources.

Gross loans and advances surged 1% month-on-month to BGN 56.4 billion.

Corporate loans picked up 1.1% on the month backed by small and medium banks, while the top five banks drove the 2.2% monthly growth of retail exposure.

Housing loans rose 2.4% month-on-month to BGN 8.028 billion, while the consumer loan portfolio expanded by 2% to BGN 9.1 billion.

The sector’s profit totaled BGN 1.217 billion in October, up by 26.2% year-on-year versus 28.6% year-on-year in September.

(Dnevnik)

Heating energy consumers may be intimidated by creeping prices and unhook from the grid despite interest from new users, according to a 2009-2030 energy blueprint reviewed by Government on Thursday.

Electricity and heating energy consumption will go up but the similar prices will prompt household to switch to power from central heating.

Energy watchdog chairman Konstantin Shushulov has warned that the energy system would break down if it were overwhelmed by heating consumers.

Some 20 percent of Bulgarian households are now hooked to the central heating system

The Sofia heating utility said on Friday household consumers have triggered BGN 218 million out of its total debts of over BGN 300 million.

Bulgaria is the only EU country where utilitities service flats separately, and cutting off power supply only to debtors is technically impossible, according to the strategy.

Therefore neighbours should be encouraged to unite in associations, an option which now offers lower prices, the document says.

Heating bills can be reduced by combined production of heat and power which is purchased by the national power grid operator NEK at preferential tariffs. The output is expected to double by 2020.

Only 1.5 percent of Bulgarian households have access to gas distribution grids compared to 55 percent in the rest of Europe as investments and maintenance costs are higher than the price of a heating energy unit.

At the same time, Bulgarian distributors charge some of the lowest power and gas prices in the EU, according to the strategy.

(Dnevnik)

Bulgaria’s cigarette producers will battle high excises and the financial crisis with a price war next year, said Kornelia Ninova and Ivan Bilarev, the newly-elected executive directors of Bulgarian tobacco holding group Bulgartabac.

The new excise dutities from January 1, 2009 yet to be voted at second reading will have their toll on cigarette prices in late March, experts say.

The parliamentary budget committee voted duties of 40.5% of the market price plus BGN 41 for 1,000 pieces.

Bulgartabac and cigarette factory Slantse Stara Zagora said the new tax was unjust.

Western companies operating on the market declined to comment.

The new excises will reduce the difference between the most expensive and the cheapest brands, according to Bilarev.

The higher percentage rate goes against EU practices by punishing costly brands, said Philip Morris Bulgaria.

Under proposed legislative changes, Parliament should take over from the finance ministry the task to approve the term of old excise labels at the acception of the new.

Japan Tobacco international (JTI), which supplies the Camel and Winston brands in Bulgaria, said the amendment would hurt cigarette companies by making the market unpredictable.

Bulgartabac and Slantse Stara Zagora gave the thumb-up to the proposal.

Slantse Stara Zagora executive director Stefan Slavov told Dnevnik in a recent interview the new law would place all market players on an equal footing.

(Dnevnik)

Bulgaria’s total producer price index dropped by 0.9% month-on-month in October, showed data of the National Statistical Institute.

The index gauging the price movement on the domestic market fell by a smaller 0.8% showing that companies charge more at home than abroad.

However, manufacturers cut prices on the Bulgarian market by 1% with prices slumping 14.7% in the ore mining business and 7.5% in the metal production and casting industry.

Metal products, machines and equipment makers saw prices rise by 1.9%.

Prices in the textile industry edged up by 1% excluding clothing, and prices of food and beverages rose by 0.4%.

Domestic producer prices increased by 10.1% on the year, whereas the total index registered an 8.9% inflation rate.

The producer price index reflects businesses’ attitudes and readiness to invest or expand production operations.

Persisting deflation is a sign of an upcoming crisis as it triggers off production cuts and job losses.

(Dnevnik)

Postbank has drafted a set of measures to cushion the negative impact of the global crisis on customers, said executive director Anthony Hassiotis.

As of December 1, Postbank will offer BGN 50 million of funding to small and medium companies under a joint credit line with the European Bank for Reconstruction and Development.

By the end of January the bank will charge zero prepay penalties on all types of business and corporate loans.

Some of Postbank’s loans will come with lower interest rates, while deposits will offer bigger return.

All credit cards requested by December 31 will be charged a 2% lower annual interest rate.

All new one-month deposits for individuals opened with a bottom BGN 500 by the end of the year will offer a promotional 10% annual interest rate.

Postbank will unveil a new package of measures every three months.

“The current economic environment faces businesses and households with extraordinary challenges. Therefore we are determined to be proactive about our customers’ needs by taking series of steps to limit the negative impact the crisis is having on them,” Hassiotis said.

(Dnevnik)

The Bulgarian capital market registered a weekly rise as indices continued to erase losses on Friday.

SOFIX of the blue chips inched up by close to 1% to 363 points, just about as much as the broader BG40, which ended the week at 108.6 points.

The property index BGREIT was the only one to close in the red with a daily drop of over 2% to 47.38 points.

Dnevnik 20 of the biggest and most liquid companies gained 1.55% to 57.15 points.

Trading at fuel distributor Petrol again shot turnover above the BGN 20 million benchmark jumping to a record BGN 11.80.

Insurer Euroins was the most lucrative SOFIX component vaulting almost 10% to BGN 2.99.

Car battery maker Monbat surged over 8.5% finishing trading at BGN 4.69 points.

Also among the bulls were construction materials distributor Toplivo, paint and varnish maker Orgachim, drug maker Sopharma and industrial conglomerate Chimimport.

Banks broke into positive territory on Friday with Central Cooperative Bank adding over 9% to its market value and First Investment Bank up over 2%, but Bulgarian American Credit Bank shed over 3%.

BGREIT saw a bunch of steep falls led by Active Properties which dove 40%.

Agro Finance slid over 14% as more than 300,000 shares changed hands.

Bulland Investments lost over 24% of its value amid weak turnover.

The most liquid position in the index was Park REIT, which sold more than 900,000 shares at BGN 1.18 apiece, up a whopping 24%.

(Dnevnik)