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Historical profile of Association of Banks in Bulgaria

Historical profile of Association of Banks in Bulgaria

The Association of Commercial Banks was established on the 9th of April 1992 at the city of Plovdiv. It is one of the first branch non-profit organizations in Republic of Bulgaria, seated in Sofia, 12 Batenberg Str. Founders are forty seven commercial banks. The Statute was approved and the first Executive and Control Boards were elected at the founding meeting.

A National Commission on Banking Technique and Practice including bank experts in the field of international payments was set up in October 1994. It acts as a mediator between the Bulgarian banks and the Commission on Banking Technique and Practice at ICC in Paris.

The organizational structure of the Association of Commercial Banks was adopted in December 1994, according to which commissions, committees and working groups were created, acting on permanent and temporary programs: ”Legal Committee”, “Economic Policy”, “Information Technologies”, “Capital Markets” and “Bank Security”. The Legal Committee started its functioning at the Association.

A Court of Arbitration was created in May 1995 at the Association of Commercial Banks as an independent legislative institution, empowered to solve civil and commercial disputes in which at least one of the parties was a bank. The list of arbitrators included leading jurists in the field of banking and commercial law.

As of the 2nd of June 1995 the Association of Commercial Banks became a corresponding member of the Banking Federation of the European Union with headquarters in Brussels, Belgium.

In March 1997 an amendment of the Statute of the Association of Commercial Banks was adopted allowing subsidiaries and branches of foreign banks, registered in Republic of Bulgaria to be accordingly full and associate members.

In March 1998 the Association of Commercial Banks acquired 50% of the International Banking Institute owners’ capital and, through this act, the opportunity to participate directly in the preparation of short and long-term training programmes.

A Capital Markets Committee, including representatives of commercial banks – members of the ACB, started functioning in June 1998, as its Statute was approved and its governing body was elected.

In October 1998 the Board of the European Banking Federation transformed the existing corresponding member status of the banking associations of the countries acceding the EU into associate members in order to enhance the EBF cooperation with these countries in view of their further integration in the European structures.

An Economic Policy Committee, including representatives of commercial banks – members of the ACB, started functioning in June 1999. The Committee approved its Statute and elected its governing body.

An Information Technologies Committee at the ABB Executive Board started its activities in May 2000, including representatives of commercial banks – members of the Association. The Committee adopted its Statute and elected its governing body.

At the 10th Meeting of the Associates of the European Banking Federation held in May 2000 the Association of Commercial Banks became a member of the EBF Pre-accession committee. This act represented a next step in the integration of the Bulgarian Banking Association in the European structures.

A Security Committee at the ABB Executive Board started its functioning in June 2002, including representatives of commercial banks – members of the Association. The Committee adopted its Statute and elected its governing body.

In February 2003 the BNB started publishing the interbank reference rates SOFIBOR and SOFIBID established on the basis of a trilateral contract between the Bulgarian National Bank, the Association of Commercial Banks and the Bulgarian Dealers’ Association. The seat of the Steering Committee is at the ACB.

In April 2004, due to the necessity of up-dating and supplementing, the Ethical Code of the Association of Commercial Banks was approved by the General Assembly of the ACB, replacing the Code of Good Banking Practice, adopted in 1995.

In December 2004, according to a contract signed among BNB, ACB and the Bulgarian Dealer’ Association the calculation and the official publication of a third reference rate – LEONIA started. The name of the reference rate combines the initial letters of Lev Over Night Index Average. By a decision of the Governing Council of the BNB, LEONIA has been used as a basis for calculation of the base interest rate since the 1st of February 2005.

In 2005 in accordance with the requirements set in the Law on Money Transfers, Electronic Payment Instruments and Payment Systems a Conciliation Commission on Payment Disputes was created. The Commission consists of representatives of the Consumer Protection Commission, the BNB and the ABB in order to solve disputes related with money transfers and usage of electronic payment instruments, mainly bank cards. In November 2009 by entering into force of the Law on Payment Services and Payment Systems, the Conciliation Commission became an out-of-court dispute resolution body at the Consumer Protection Commission for solving disputes between payment service providers and payment service users as well as between issuers of electronic money and their clients in relation with the application of the Law on Payment Services and Payment Systems /LPSPS/ and the supplementary legal acts on its adoption, including Regulation 924/2009 of the European Parliament and of the Council as of the 16th of September 2009 on cross-border payments in the European Union, revoking Regulation 2560/2001.

The Association of Commercial Banks changed its name to Association of Banks in Bulgaria by a resolution of the General Assembly as of the 3rd of April 2007.

On the 3rd of April 2007 the General Assembly of the Association decided to establish Payment Systems Committee as a supporting structure functioning on permanent basis at the Executive Board of the Association of Banks in Bulgaria. The Committee consists of member-banks representatives.

At the end of April 2007 by a decision of the Executive Board of the European Banking Federation (EBF) in Brussels the ABB was affiliated as a full member of the Federation as of May 2007. The Chairman of the Executive Board of ABB represents the Association in the Executive Board of the EBF, which is its supreme governance body, and according to the EBF Statute – the Secretary General of the ABB represents the Association in the operational management body of the Federation – the EBF Executive Committee.

In June 2007 the ABB was accepted as a member of the European Payment Council (EPC) in Brussels. The Executive Board of the ABB nominates the ABB representative in the EPC Plenary who also represents the Bulgarian banking community in that body. By a decision of the Executive Board of the ABB as of the end of 2014 the ABB changed its membership at the EPC from full membership to associated membership as of the 1st of January 2016. As an associated member the ABB keeps its possibility for participation in the EPC working groups and the Association continues to have its representative in the Scheme Evolution and Maintenance Working Group at the EPC.

As of October 2007 the following temporary working groups with expert and consultative functions are created at the Executive Board of the ABB: Working Group on Payments with Banking Cards, Working Group on the Development of Cash Circulation, Working Group on Custodian and Depositary Services of Banks, Working Group on Prevention of Money Laundering and Terrorism Financing, Working Group on Consumer Affairs and S.W.I.F.T. Users Group.

As of July 2015 six committees are functioning at the Executive Board of the ABB which are regulated by the Association Statute: Payment Systems Committee, Legal Committee, Economic Policy Committee, Capital Markets Committee, Information Technologies Committee and Security Committee. There are also ten working groups functioning at the ABB created by a decision of the Executive Board of the Association and they are as follows: Working Group on Prevention of Money Laundering and Terrorism Financing, Working Group on Payments with Banking Cards, Working Group on Consumer Affairs, Working Group on EU Programmes and Other Funding, Working Group on Custodian and Depositary Services of Banks, Working Group on the Development of Cash Circulation, S.W.I.F.T. Users Group, Temporary Working Group on FATCA Application, Working Group on Communications, Working Group on Information Security.

In 2015 due to its membership in the EBF and the EPC the ABB representatives participate in the Payment Systems Committee, Financial Markets Committee, Legal Committee, Banking Supervision Committee, Consumer Affairs Committee, Anti-Money Laundering and Anti-Fraud Committee, Cyber Security Working Group at the EBF as well as in the Scheme Evolution and Maintenance Working Group at the EPC.