The currency board which successfully operates in Bulgaria keeps relatively low the increase in the bad loans levels, UniCredit Group’s Head of CEE Business Development Federico Ghizzioni told journalists from international media in Milano.

He explained that the stability of the currency board has protected the Bulgarian lev from depreciation, which for its part has prevented more serious difficulties for the households and the companies in servicing their loans.

Ghizzioni pointed out that although 2009 will be the most difficult year for the region, on the whole the prospects for development of the banking sector in Central and Eastern Europe remain unchanged. UCG’s analysts expect that in the forthcoming years the region will continue to “catch up with” Western Europe regarding financial services distribution although at a more moderate speed. The speed of lending in CEE will depend on bank’s portfolio quality. “The level of problem loans will determine whether financial institutions will focus on risk control or on seeking new business opportunities”, Ghizzioni thinks.

He added that another major difference of lending in the future, compared to previous years, will be closer linked to the local savings levels.

Federico Ghizzioni once again underlined the commitment of UniCredit Group to the development of the region. He gave as an example the agreements that the group signed this year with the European Bank for Reconstruction and Development and with the European Investment Bank.

Contact person:

UniCredit Bulbank, Public Relations and Corporate Communications

Victoria Blazheva, tel: 02/9264 993, wjlj/ebwjepwbAvojdsfejuhspvq/ch

Ekaterina Ancheva: tel: 02/9264 963, flbufsjob/bodifwbAvojdsfejuhspvq/ch