The share of bad and restructured loans in the Bulgarian banking system decreased for the first time since the beginning of the year. The latest data from the Bulgarian National Bank (BNB) shows that this share stood at 23.55% of the bank credit portfolio in June, overdraft excluded. In May, bad loans were 23.65% of all granted loans, Darik Finance informs.

The improvement in the credit portfolio might be the result of the income from seasonal employment in tourism, agriculture and construction that is typical of the summer. Thanks to this income, some people can afford to resume the payment of their current liabilities, the instalments of which were delayed in previous months.

This is proven by the decline in the total volume of loans granted to households. At the end of June, households owed banks BGN 18.758 bn, down 1.1%, compared to June 2011. The fall is due to the drop in consumer loans by 1.9% on an annual basis to BGN 7.433 bn.

Meanwhile, household deposits went up by 14.1%, compared to June 2011, reaching BGN 32.432 bn. Of all household loans, overdraft excluded, 20.07% are bad or restructured, compared to 20.50% at end-May 2012.

So far as businesses are concerned, the situation is markedly different. Bad loans granted to non-financial companies increased to 25.93% of all loans, or BGN 6.462 bn. This is why the volume of bad loans in the portfolio of Bulgarian banks totaled a new record-high of BGN 9.909 bn at end-June.