From April to June this year, Bulgarian banks have granted 3,734 housing loans, according to quarterly statistics from the Bulgarian National Bank (BNB). The number is twice as high compared to the previous quarter and represents the most significant increase on a quarterly comparison basis since the credit boom in 2008-2009. Thus, as at the end of the first half of 2021, the total number of housing loans outstanding in Bulgaria increased to 177,300 most of them with maturity of over 5 years. In nominal terms, the value of these loans amounts to nearly 13 billion levs (6.6 billion euro).
This peak reflects the high number of transactions reported on the real estate market in recent months. Аccording to Registry Agency data, in the first six months of the year, 105,402 real estate transactions were concluded - 14% above the number recorded in pre-pandemic 2019 and 40% more than in Covid-marred 2020.
Data from the National Statistical Institute show that 1,745 permits for construction of residential buildings were issued in the second quarter, representing 1.18 million square meters of gross floor area. The largest number of building permits were issued in Sofia, opening the way for construction of 5,367 dwellings with 571,235 square meters of built-up area. In second place in terms of area is Plovdiv with 117,017 square meters and Varna with 99,040 square meters.
The increase in consumer loans to households in the second quarter was more moderate. According to statistics, their number rose by just 2,855 compared to the first quarter. As a result, at the end of the first half of the year, the total volume of outstanding loans in this segment increased to 12.6 billion levs (6.4 bln euro).
The number of loans granted to households and non-profit organizations in April-June increased by 8,076 compared with the previous quarter, bringing the total number of outstanding loans to 2.8 million as at the end of June, with total value exceeding 27 billion levs (13.8 bln euro) in nominal terms. The most significant increase in the volume of loans to households in the April-June period compared with January-March was in the segment ofcredits of 100,000 to 250,000 levs -382 million levs.
Loans to companies
In the second quarter, the number of loans granted to non-financial corporations increased compared to the previous quarter by just 0.1% to a total of 141,500 loans as at end-June. At the end of the first half of the year, the nominal amount shrank by 0.6% compared to end-March, to 35.9 billion levs (18.3 billion euro) entirely due to a decrease of 377 million levs in the group of loans of over 1 million levs each. The drop is due mainly to a decline in lending to materials processing businesses by 474 million levs.The main driver of growth of corporate loans in the second quarter was the transport and logistics sector, where loans increased by 164 million levs (7.3%) to 2.4 billion levs (1.2 billion euro) compared to January - March this year. There was a significant increase of over 100 million levs in loans to the construction sector.
The most popular among companies in the second quarter were loans of more than 50,000 levs each. In April-June, 840 loans were granted for similar amounts. As a result, the total number of outstanding loans of this type increased to 42,800 as at the end of the first half of 2021, according to the Bulgarian National Bank.