The blue-chip index of the Bulgarian Stock Exchange shed 2.79% to 309.70 points in another tumultuous session ending at a bottom unseen in the past six years.

The sharp drop was influenced by the gloom on the U.S. stock markets, which spread across Europe, commented Nikolai Kichukov, broker at investment brokerage Elana Trading.

Almost all of the world’s leading indices finished the day deep in the red.

Dnevnik 20, which gauges the 20 biggest and most liquid companies, was the worst hit index on the BSE, dropping over 4% to 45.18 points.

BGREIT of the property funds was the only one to resist the slide finishing 1.67% higher at 46.32 points.

Trading volumes picked up to BGN 7 million on the back of real estate stocks. Special purpose vehicles BenchMark Real Estate Fund and Elana Agricultural Land Opportunity Fund generated half of the daily turnover.

Some of the most liquid stocks, among them industrial conglomerate Chimimport, First Investment Bank, Corporate Commercial Bank and Eurohold Bulgaria, enjoyed busy trade but FIB led losers with a double-digit drop.

(Dnevnik)

Bulgaria ranks among the countries whose budget accounts may be at risk in case of government bailouts for the biggest local banks, rating agency Moody’s forecast in a report on the impact of the crisis on the global financial sector.

In countries like Bulgaria the capital market is less mature and banks rely for funding on parent companies and interbank markets, the report says.

Governments will have to move in to help banks out of a recession already making funding extremely hard to come by.

This could be a daunting challenge especially for countries with wide current account gaps, according to the analysts.

Bulgaria shares the risk list with neighbouring Romania, the Baltic States, Hungary and a bunch of countries from other parts of the world such as Ecuador and Bahrain.

East European banks held up well when the crisis broke but now the subsequent global economic deterioration has reduced ample funding from parent companies to a mere trickle.

(Dnevnik)

The state and bondholders, who are the biggest creditors of Bulgaria’s ailing steel mill Kremikovtzi, have presented their common stance to the prospective bidders for the insolvent company.

Ukrainian company Smart Group of mogul Rinat Akhmetov and Brazilian CSN are considering the parameters of the offer before they accept it or resume talks.

Negotiations with the Brazilian candidates have been more intense, with the company already doing due diligence at the Bulgarian mill.

However, one of the biggest bondholders voiced concerns that both suitors plan to restructure the mill’s debt, which means that possible payouts will be put off for a later stage.

Both candidates have reached agreement in principle on toiling contracts at Kremikovtzi, which can enter into force right after securing consent from the Government and the bondholders, the plant said.

Local legislation does not allow extending acquisition guarantees before a bondholders’ meeting is held, raising a question mark over technological rebooting and operating capital investments are under question.

This was what drove away India's steelmaker Arcelor Mittal and Vorskla Steel, owned by Ukrainian billionaire Konstantin Zhevago.

(Dnevnik)

Austrian company WBG has tested its EUR 4 million biomass power plant, which will heat public and private buildings in the town of Ihtiman, near Sofia, Ilko Yotsev, managerial agent of the firm’s Bulgarian unit, told Dnevnik.

The facility will have a rated capacity of 3 MW that may be expanded to 10 MW and run on 10,000 tonnes of wood waste a year.

The investor has deployed an eight-kilometer heating distribution network and has installed a cutting-edge plant room control technology.

Heating will reach the first consumers within ten days from testing completion, according to Yotsev.

Tariffs will be some 30% lower than those of Bulgaria’s conventional gas-fired heating utilities, under company estimates.

The company plans to have 20 MW of biomass energy capacities across the country to help reduce its dependence on gas supplies, said Yotsev.

The new plant is operated by local firm Bio Energy.

(Dnevnik)

Bulgargaz will demand extra gas volumes at lower tariffs as compensation for the cut-off following the Russian-Ukraine conflict, Prime Minister Sergei Stanishev told a press conference.

The state-controlled gas company estimated that Gazprom’s subsidiaries -- Overgas Inc., Wintershal and Gazpromexport -- have defaulted by 123.8 million cubic metres of gas flows.

Energy Minister Petar Dimitrov said a day before that the Russian gas supply contract envisages an 8% price discount and claims for further damages in dollars in case Bulgargaz loses more than the discount, according to the minister.

But no discount will be made if the volumes are delivered over the next three months, under the contract.

Thus, Bulgaria will get no compensation for the damages from the gas supply disruption triggered by a pricing row between Kiev in Moscow with the latter throwing in accusations of siphoning off transit flows.

Bulgargaz is still calculating the losses from the gas crisis. The company has filed a claim against one of the three supplies, executive director Dimitar Gogov said on Tuesday without elaborating.

(Dnevnik)

The Bulgarian government will lower the investment promotion threshold to BGN 30 million from 70 million at present and suspend the class A and B division, under proposed legislative changes.

The announcement was made by deputy energy minister Yavor Kuyumdjiev, whose ministry will table the proposal with the Council of Ministry by end-January.

The measures aim to beef up investment support, which was so far extended mostly to large-scale projects of over BGN 70 million, the official said.

Just above a dozen investors received government help last year due to the high threshold, showed an analysis of InvestBulgaria, the local investment promotion authority.

Under the current legislation the state backs first-class certificate awardees, who develop projects worth at least BGN 70 million, with building adjacent infrastructure.

Second-class investment certificates offer fast-track administrative support to investors who pump at least BGN 20 million.

The proposal will also put down to BGN 4 million from BGN 7 million the threshold for high-tech investments.

The registration procedure for Bulgaria’s state-run industrial zone development company should be wrapped up by the end of the month. The first half a dozen zones should emerge by the middle of the year.

However, businesses took the planned amendments with a pinch of salt due to the fuzzy selection criteria about zone locations.

The first industrial zones should be built in areas with high jobless rates, said Kiril Asenov, manager of window coverings manufacturer Arexim, noting that industrial employment in the southern town of Smolyan has shrank to about 1,000 people from 16,000 in the last twenty years.

(Dnevnik)