Implications of Market Value Versus Book Value Accounting in Bulgaria Banks

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Implications of Market Value Versus Book Value Accounting in Bulgaria Banks

Contents

  1. Historical Background ………………………………………………………… 3
  2. Bulgaria Politics ………………………………………….……………….. 5

Chapter 2 – Theoretical Framework………………………………………………. 8

2.1 Implementation Implications ……………………………...…………….. 8

2.2 Market Value Accounting Versus Book Value Accounting ………...…. 9

Chapter 3 – Empirical Study Design ……………………………………………… 10

3.1 Fundamental Principles……………………………………………..……. 10

Chapter 4 – Empirical Study Implemented……………………………………….. 11

4.1 Commercial Banks…………………………………………………..……. 11

4.2 United Bulgarian Bank (UUB)…………………………………………… 12

4.3 Bulgarian National Bank………………………………………..……….. 14

Chapter 5 – Conclusion & Recommendations………………………………….... 15

Bibliography ……………………………………………………………………..… 17

The foundational basis of a nation’s economy is driven by a number of factors and these are based upon its monetary policies as the stability, soundness and trust in its currency is the foundation upon which all other equations are based. The growth and importance of international trade has proceeded more rapidly than global economic output[1] and presently the methodologies concerning individual economies have taken center stage. This is the climate that is acting upon Bulgaria as it seeks to strength its regional ties as well as global recognition through membership in the European Union. It is this climate which is acting upon Bulgaria and its banks as the country is in the process of ensuring it meets the varied rules and regulations for approval of its application for membership in the European Union which was originally submitted on 14 December, 1995.[2] The membership application as established under the Council of Ministers sets forth:

  • that the candidate country has achieved stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities;
  • the existence of a functioning market economy, as well as the capacity to cope with competitive pressure and market forces within the Union;
  • the ability to take on the obligations of membership, including adherence to the aims of political, economic and monetary union.

It is this last provision which is the foundation for the subject matter of this paper as the ability of Bulgaria to meet the existing rules and regulations governing monetary policy starts with the compliance of its banks concerning all aspects of this area and the new accounting policies as set forth by the European Union which has recently specified that under International Accounting Standards 39 (IAS) that all members implement the ‘fair value’ method in preparing their Consolidated Balance Sheet Statements for accounting period that begin on or come after 1, January, 2005.[3]

1.1 Historical Background

The end of the Cold War changed the dynamics of the world as the division that consisted of the Free World and Communist Bloc countries was eliminated. This major shift from political and militarily driven interests to financial and economic concerns has caused nations and their regional affiliations to concentrate on the implementation of measures designed to strengthen fiscal and other programs which enhance their ability to compete both regionally as well as globally. The increased level of global interdependence has meant that individual countries have and are focused on ensuring that their internal economic and monetary policies utilize formats and frameworks in keeping with the accepted international and regional norms as this yields benefits for the country in terms of trade as well as internal economics. The example of the United States after the end of World War II has served as a model concerning capital formation to aid companies in the raising of money to finance the expansion of their business interests on a global scale. As a result of that country’s seamless capital market structure (stock markets), it has the largest singular system for investors under the protection and oversight of the United States Federal Government to participate in. Individual as well as institutional investors can gain access to the stocks of various companies through the New York Stock Exchange (NYSE), American Stock Exchange (AMEX), and the National Association of Securities Dealers Automated Quotation (NASDAQ).

The formation of the European Union provided the opportunity for the continent to organize the smaller countries comprising its region under a larger umbrella whereby mutual cooperation enables them individually and as a unit to compete on an equal footing with larger countries and markets. In organization of 25 member nations whose activities entail economic, foreign affairs, defense and a multitude of other areas all designed to strengthen the region’s ability to compete with other global regional organizations and countries, such as:[4]

  1. The United States, and the North American Free Trade Agreement which consist of Mexico and Canada
  2. Andean Free Trade Zone, which consists of Bolivia, Colombia, Ecuador, Peru and Venezuela
  3. Mercosur, which is the Southern Cone Common Market (Argentina, Brazil, Paraguay and Uruguay)
  4. ASEAN, which is the Association of South East Asian Nations
  5. SAARC, which is the South Asian Association for Regional Cooperation which covers almost all of Asia to the east of Afghanistan
  6. China, whose status as an emerging nation of 1 billion individuals makes this country in essence its own trading bloc.

The European Union understood that the smaller population base of countries in their region did not afford them with the numerical clout to effectively raise the large sums of capital that companies in the United States with its population of 250 million plus could draw upon. It addition this huge market with a single currency, common laws and media structure provided those companies with a domestic base to generate sales and strengthen their ability to enter other global markets. The present European Union oversees 25 member nations with a combined population of 453 million.[5] The principle barriers to this region being able to effectively trade and utilize this population base effectively consisted of the fragmented individual stock exchanges well as currencies. The cost of converting currency transactions cross border was a major inhibitor to investor participation, as well as the differing rules, accounting procedures and stock market regulations. The foregoing effectively eliminated all but the most sophisticated individuals from participating in the varied investment opportunities thus limiting the capital access potential for public companies to raise funds to finance expansion, equipment and related activities.

Under the European Union a seamless stock market system is taking place, as well as consistent accounting rules, economic policies and allied regulations. The preceding along with the creation and implementation of a single monetary unit, the Euro, is effectively removing the major impediments to the foregoing.[6] In consort with this, Bulgaria must conform to IAS accounting policies with one specific area being the utilization of market value accounting, which is also known as ‘fair market value’. This paper will examine the climate that is fostering a change in accounting policy and procedures as well as the benefits it is expected to achieve. The questions that arise as a result of this change revolve around if this method effectively states the value of an organization and contributes to strengthening investor (individual as well as institutional), confidence.

1.2 Bulgaria Politics

Formerly aligned with the Soviet Bloc, which collapsed in 1989, Bulgaria held its first free elections since 1931 in June of 1990.[7] This brought the Bulgarian Socialist Party to power and the country found that the transition to capitalism from communism was a painful economic lesson. Bulgaria underwent extremely high levels of unemployment as the industrial base was unprepared to compete with the modern structures of other European countries and global nations. This failing created the climate for the anti Communist Union of Democratic Forces (UDF) to gain power. Their platform of privatization and a quasi cooperative economic policy did not solve the country’s underlying structural problems and resulted in further business failures and increased unemployment. More importantly, the country’s physical and economic infrastructure lacked the sophistication to attract foreign investment in either capital or foreign plant location as a result of the lack of appropriate skills and educational level of its populace. In 1995 the BSP government of Zhan Videnov was voted to power as a result of the public displeasure with the state of economics under the UDF, however this new regime did not fair much better because in 1997 the BSP government collapsed and was replaced by the United Democratic Forces (UtdDF).[8]

1.2.1 Bulgarian Economics

The underpinnings of the 1996 collapse of the Bulgarian economy through the failure of its industrial base had deeper implications which were created by the instability of the lev, high inflation and the near complete failure of the banking system.[9] One of the first moves made by the new government was to peg the lev to the strong German mark on a parity basis (one lev equaled one mark), under the provision that the government maintain “… hard currency reserves…”[10] which would cover all levs that were in circulation and in commercial banks. The preceding also included a restriction on mew borrowing by the banks and these measures helped to reduce inflation from 484.2% during the first part of 1997 to 3.7% by July of that same year.[11]

These round of reforms also served to eliminate the weaker financial institutions (banks) from the equation thus consolidating the market which had the effect of increasing the degree of confidence in this sector, as well as helping to reduce the debt of companies as well as the government. The developments provided the first step in establishing a sound fiscal under footing. Banks were privatized along with state owned and run industries and this helped to set the climate for increased foreign investment which resulted in a needed influx of hard currency. The cash infusion generated by the sale of state owned enterprises was an aid in raising capital to help fund the economic turnaround and the new Bulgarian stock exchange is playing a major role in helping the country finance industry growth and expansion.

1.2.2 Banking

Government reforms, the legislation of tougher laws throughout all segments of society, the privatization of banks, compliance to IMF rules and the application to the European Union have dramatically changed foreign attitudes and their vision of Bulgaria. As a result of the foregoing investment inflows have increased dramatically. Currently the Bulgarian National Bank maintains the government debt registry as well as makes debt service payments and collects data from budget service banks regarding the state budget for which it receives a fee. Under the State Budget Law all commercial banks can act in this capacity thus opening this area to a cost effective application system.[12] The country’s pending admittance to the European Union has put all banks in the position of complying with the rules and regulations which are readily understood as well as issuing financial reports in accordance with International Accounting Standards (IAS). The progressive thinking of the European Union in aspects such as these are the reasons it creates confidence in the investment community for those countries that are members as well as those under consideration or pending membership as the strict guidelines utilized are known entities.

A 2 July, 2004 Report issued by Standard and Poors upgraded the rating for “… long-term credit and certificate of deposit ratings…”[13] for United Bulgarian Bank from “BB” to “BB+” which reflects a stable economic outlook. It also went on to state that the preceding upgrade was due to “… the strong benefits that … UBB derive from … restructuring and modernization programs supported by their foreign strategic investors…”.[14] That same article added that there have been continued improvements in the economic climate which shows a potential for high growth that is underpinned by a strong competitive environment and government support of sound macroeconomic policies. The foregoing is supported by the improvement of the lev against the United States dollar, as it has risen from $.54 in May of 2003 to $0.66 in mid April 2005[15]. In consideration of the foregoing, the United Bulgarian Bank shall be utilized as the source for this paper in conjunction with Bulgarian National Bank.

Chapter 2 – Theoretical Framework

2.1 Implementation Implications

Bulgaria’s pending application to the European Union has yielded positive economic results for the country in advance of its acceptance by providing other nations and private investment sources with confidence in the development of the country due to the reforms it has been undergoing as well as its adherence to strict policies which accompany EU pending membership. One of the hallmarks of the European Union are the sound economic policies under which it operates. These policies have proven themselves by the performance of the Euro[16], which was only introduced in 1 January 2002, against the United States Dollar. When introduced in 1 January 2002 the Euro traded at approximately $0.90 to the U.S. Dollar with some minor fluctuations both above and below this band. Presently the Euro trades at $1.29 and has risen as high as $1.33. The preceding is a direct result of the strict monetary and economic policies implemented by the European Union as well as the positive trade balance the region enjoys versus the huge monthly trade deficits of the United States. In terms of market performance and underpinnings, the days of the United States dollar being the foremost currency in the world is numbered, if this is not already the case.[17]

2.2 Market Value Accounting Versus Book Value Accounting

The compliance changes mandated by the European Union which requires that all member nations as well as those seeking membership must adhere to the rules and regulations in force or which shall be in force is aiding Bulgaria in the strengthening of its economy. The regulation that is referred to in this instance is the requirement that as of 1 January 2005 all companies that are listed on any regulated market must prepare its consolidated financial statements under International Accounting Standards (IAS) rules. This requirement provides the European Union with a standardized financial reporting system which can be easily understood by all member nations, international investors and individuals. It eliminates the potential for assets or liability conversion misunderstandings which can and do occur under different accounting principles and helps to enhance the flow of trade, investment and money across borders, both inside and outside of the European Union.

Valuing assets and liabilities at their market value, if this is known, or their fair value, which is the amount for which an asset could be exchanged or settled between two parties who are knowledgeable, is a more accurate representation as it reflects real world conversion. On the opposite side of the coin there are those proponents who believe that book value is a better measure in that it represents the fiscal performance of the business and they further state that the estimates upon which market value are based might not be either verifiable or reliable.[18] The International Accounting Standards position on market value is based upon this methodology providing increased transparency as well as enhanced information in the financial disclosures as a result. The instantaneous nature of today’s capital markets as well as reporting systems means that the ease of obtaining a basis from which to accurately reach a determination on the market value of almost any item can be obtained readily. However, the problem with market value lies in the methodology employed as there are those items which do not fall within the province of a readily obtainable or reliable valuation base.

In those instances where there are extraneous values at work the calculation of market value must adequately disclose how the value was calculated as well as how the changes have been computed. An example of the foregoing are securities. Changes in the market value in this instance can occur as a result of interest rate fluctuations, currency exchange rates, credit worthiness as well as trading securities in a portfolio[19].

The book value is the business valuation based upon the accounting books of the enterprise at initial costs.[20] Assets minus liabilities equal the owner’s equity which is the book value of the business. The problem with this method lies in the fact that the accounting records may not accurately reflect the true present day value of the assets in the business valuation which can fluctuate over time.[21] The market value method is preferable as the valuing of a company is not an exact science. It can vary based upon the type of enterprise and consists of a broad variety of factors which comprise the process as a result of both tangible and intangible aspects. The value of an enterprise is a function of its cash flow, pent up order demand, market positioning and ability to generate consistent profits. The preceding is what determines worth. As these variable change over time, utilizing the book value does not reflect or account for the fluctuations of these variables as well as the differing weights these variables contribute as a result of said fluctuations.

Chapter 3 – Empirical Study Design

3.1 Fundamental Principles

The subject matter of this paper concerns itself with the manner in which market value accounting differs from book value accounting and the implications of the inherent difference in the environment of Bulgaria banking. The preceding location parameters means that the net effect of historical, present day as well as potential future developments become a part of this equation and therefore must be considered. Prior segments of this paper have addressed a summary history of the country to establish the background events and circumstances which have acted upon and in some instances are still acting upon and affecting the present day developments. Since Bulgaria does not exist within a vacuum and is therefore subject to, acted upon and acts upon the countries which it interacts with as well as the environment in those regions and the changes and developments of said region, these factors where included in this equation through a discussion of the European Union.

The context of the preceding means that one must be cognizant of the forces which are revising past historical aspects and influencing present day developments as the country prepares for its entrance as a full fledged member into that organization. These events will act upon and set the stage for certain situations and parameters in the future as well as the context of the subject manner being addressed. Without addressing these important historical, contemporary and future events the rationale behind the question would be missed, thus lending the answer as an academic discussion of principles without a real world setting. The external manifestations of global economics in context with regional developments are rooted in the lessons of the past via which proper planning can help to change or direct the course of the future. The preceding indicates the path that this paper has taken from its beginning on through to the conclusion as the context is a real world study. It must be remembered that the question of whether market value accounting provides a more precise set of figures in the balance sheet than book value must be considered within the context (environment) of its application. Without defining that environment through historical and contemporary terms, the question is rendered as moot.

Chapter 4 – Empirical Study Implemented

4.1 Commercial Banks

The compliance with the European Union’s International Accounting Standards (IAS) in the instance of market value methodology requires the reporting of the bank’s financial position which includes a broad array of instruments that are best served by this approach. The consistent fluctuations of the bank’s holdings, interest rates, currency fluctuations and other variables means that it must have an accurate reporting methodology that reflects and modifies these complex inputs in order to maintain compliance with assets, loan requirements and reserves. The lack of said standards created the Bulgarian market melt down of 1996 – 97. Sinkey’s (2002)[22] discussion of bank financial statements along with the risks and the importance of accurate valuation methods as a result of these complexities concurs with the foregoing. The market value methodology has the probability of reducing the degree of asymmetric data which has the effect of increasing liquidity, however this method also has the potential to intensify the debt miscalculation thus requiring increased regulation to ensure accurate computation methods were utilized throughout the process.

In the utilization of market value reporting assets and liabilities as a result balance out when there are shifts in position. An example of the foregoing is derivatives. As a derivative contract can be utilized to hedge risks as well as increase leverage the result of this can cause an increase in risk that needs to be recognized and reported correctly on the balance sheet. A mixed valuation method increases the potential for artificially induced volatility with respect to earnings which does not completely reflect the hedging strategies concerning economic variables which is inherent in the process. It is this aspect which might not be mirrored in the overall risk reduction exposure. Under market value accounting these hedging strategies are balanced out in that in the hedging instruments and hedged considerations are fair valued, and thus changes in directions are offset automatically therefore the net change is reflected on the profit and loss statement.[23]

The extremely diverse nature of the instruments, loans, investment positions and other bank activities of a commercial bank further compound the degrees of difficulty in accurately reporting asset and liability values. The number of forces, variables and fluctuation possibilities which can and do act upon each segment means that these aspects must be factored in utilizing a methodology which can adjust and be adjusted to fit the reality of the circumstances.

4.2 United Bulgarian Bank (UUB)

UUB is a modern institution engaged in delivering contemporary consumer banking services such as credit cards with instant loan capabilities on pre-set limits as well as full service Internet banking, telephone account access and a branch network to met consumer and business convenience. As a subsidiary of the Group of the National Bank of Greece the parent company has brought to the bank these modern service capabilities circumventing the customary internal development time frames. The parent company is a multinational institution which is listed on the Athens Stock Exchange since 1880 and on the New York Stock Exchange since 1999[24]. As a venerable institution it brings to United Bulgarian Bank the expertise gained from nearly two centuries of operation as well as a full understanding of European Union banking regulations, compliance and accounting procedures as Greece is a member of this organization.

The Group of the National Bank of Greece utilizes a line organization format[25] whereby all executive team members report directly to the office of the Chairman and Chief Executive Officer E.G. Arapoglou, and the Deputy Chairman and Deputy Chief Executive Officer I. Pechlivanidis. This organization model is an unusual ‘hands on’ direct management technique which is not usually seen in multinational operations as it entails a close involvement with the divisional units. Present day computer systems have greatly enhanced the ability of a large organization to utilize a ‘hands on’ organization matrix as one can quickly see through the use of comparative modeling examples those areas that might not be performing to predetermined guidelines. The proper use of this type of model means that top management can easily identify and delve into varied areas of operations, thus being able to maintain a finger on the pulse beat of the organization, its objectives and goals.

The broad business areas which a multinational bank engages in means that the miscalculation of asset and or liability positions can have dramatic and well as costly ramifications upon its operations and the loan to reserves ratios which is one of the underpinnings of bank operations. This points to the importance of a valuation methodology which accurately reflects conditions as they exist.[26]

4.3 Bulgarian National Bank

The reporting duties of the Bulgarian National Bank in conjunction with it overseeing the government debt registry, making debt service payments and collecting data from budget service banks for the state budget adds additional complexities to its accounting procedures as well as stating the bank’s position in financial reporting terms. It must accurately analyze and foresee potential risk factors to maintain compliance with loan and reserve mandates in the face of these variables as the chief bank behind the Bulgarian economy. The bank lists its main tasks as:[27]

  1. analysis of the financial system along with monetary policy formulation and implementation under the existing currency board;
  2. management of international reserves;
  3. management of currency circulation;
  4. maintenance of efficient and secure payment system and oversight with regard to payments;
  5. supervision of banking operations and regulation adherence;
  6. compilation of monetary and banking statistics for Bulgaria;
  7. development of international relations in varied economic sectors;

BNB also utilizes a line organization structure to manage its operations[28] which is highly appropriate considering the importance of its overseeing critical monetary and compliance aspects for the Bulgarian government and national banks. As is the case with

the Group of the National Bank of Greece, BNB utilizes a line organizational structure as it must maintain daily oversight and direct control of important data flows and information inputs in conjunction with forecast models to immediately detect variations from the norm.

Chapter 5 – Conclusion & Recommendations

The question of where market value accounting more accurately reflects a closer reporting of the operations of an enterprise versus book value seems obvious based upon the summary definition of each term:

  1. Book Value;

The amount in monetary terms that an asset is valued in business records. This amount does not necessarily reflect the figure which this asset would bring in the open market.

  1. Market Value

It represents the probable amount in monetary terms that an asset would bring in the open market and is reflected as this amount in business records

The critical difference between these methods is that the book value is arrived at prior to entering it on the business records and it is not adjusted as conditions fluctuate, whereas the market value rises and falls in step with market conditions which act upon an asset or liability. The critical concept to remember is that business enterprises are living entities which exist in live market conditions that change, modify and amend themselves moment to moment each and every day. Book value attempts to capture an amount at a particular point in time and utilize this figure as a static number which can lead to misleading assumptions of the position and thus the fiscal underpinnings of an enterprise. The foundation for such a computational method was based upon the many calculations which needed to be considered to arrive at this number in a post computer environment that did not have the benefit of a 24 hour, 7 day a week calculation potential whereby the external and internal variables acting upon an assets value could be recomputed quickly. Technology allows for constructing the mathematical variables which comprise a specific asset to be arrived at, comparing this against other models and then utilizing it to obtain real time figures.

The utilization of market value as the underpinnings for banking in Bulgaria has been decided by the European Union after the consideration of many variables in the climate of an international forum on this subject which has encompassed over a decade of discussion. The market problems caused in the United States during the late 1970’s as a result of accelerated depreciation accounting was a clear example of how inappropriate accounting measures can be applied in the absence of proper governance and procedural guidelines. The European Union has not overlooked such potentials and has adopted what is at present the best functioning method to ensure institutions, investors and the public interest are best served.

Bibliography

Afkharni, Nozar. 1997. Country Profile: Bulgaria. http://www.kenaninstitute.unc.edu/mbaec/Homepage/Current_Destinations/Bulgaria/bulgaria.html

Bulgaria.com.2005. History of Bulgaria. http://www.bulgaria.com/history/bulgaria/

Burkhardt, Katrin, Strausz, Roland. 2004. The Effect of Fair vs Book Value Accounting on the Behavior of Banks. Free University of Berlin, Germany

Committee for Development Planning.1990. Regional Trading Blocs: A Threat to the Multilateral Trading System?. P. 38. United Nations, New York

Dermine, Jean. 1993. European Banking in the 1990’s. Chapter 1. Blackwell Publishing. ISBN: 0631188436

Eckes, Burkhard, Hitchins, John. 2004. The Implementation of IAS 39 In The Banking Industry. PricewaterhouseCoopers

Europa. The European Union at a Glance. http://europa.eu.int/abc/index_en.htm

European Union. 1997. Commission Opinion on Bulgaria’s Application for Membership of the European Union. Brussels DOC/97/11

Fiduciary Capital Management, Inc. 2005. Why is Stabile Value Attractive. http://www.fcmstablevalue.com/art.htm

Gilpin, Robert. 2005. Global Political Economy: Understanding the International Economic Order. Chapter 1. Princeton University Press. ISBN: 069108677

Governing Council of the Bulgarian National Bank. 2004. Strategy for Bulgarian National bank Development Between 2004 and 2009. Bulgarian National Bank, Bulgaria

International Monetary Fund. 2001. Report on the Observance of Standards and Codes: Bulgaria Update. http://www.imf.org/external/np/rosc/bgr/update.htm

Kim, Taeho. 1999. International Money and Banking. International Thomson Business Press. ISBN: 1861524781

Madura, Jeff. 2002. International Financial Management Ch. 1. Thompson Publishing Services. ISBN: 032416551

National Bank of Greece. 2005. The Bank. http://www.ethniki.gr/en/bank.asp

Rose, Peter. 2002. Commercial Bank Management. Chapter 6. McGraw Hill. ISBN: 025615211

Shapiro, Alan. 2001. Foundations of Multinational Management. Chapter 15. John Wiley and Sons. ISBN: 0471563374

Sinkey, Joseph. 2002. Commercial Bank Financial Management (6th Edition). Chapters 5-6. Prentice Hall. ISBN: 0130909106

Sofia News Agency. 2005. S&P Upgrades Two Bulgarian Banks. 2 July 2004. http://www.novinite.com/view_news.php?id=36552

Yahoo.com. 2005. Currency Conversion: Bulgarian Lev to the United States Dollar. http://finance.yahoo.com/currency/convert?amt=1&from=BGN&to=USD&submit=Convert

1


Footnotes

[1] Gilpin, Robert. 2005. Global Political Economy: Understanding the International Economic Order. Chapter 1. Princeton University Press. ISBN: 069108677

[2] European Union. 1997. Commission Opinion on Bulgaria’s Application for Membership of the European Union. Brussels DOC/97/11

[3] Eckes, Burkhard, Hitchins, John.. 2004. The Implementation of IAS 39 In The Banking Industry. PricewaterhouseCoopers

[4] Committee for Development Planning.1990. Regional Trading Blocs: A Threat to the Multilateral Trading System?. P. 38. United Nations, New York

[5] Europa. The European Union at a Glance. http://europa.eu.int/abc/index_en.htm

[6] Europa. The European Union at a Glance. http://europa.eu.int/abc/index_en.htm

[7] Bulgaria.com.2005. History of Bulgaria. http://www.bulgaria.com/history/bulgaria/

[8] Bulgaria.com.2005. History of Bulgaria. http://www.bulgaria.com/history/bulgaria/

[9] Madura, Jeff. 2002. International Financial Management Ch. 1. Thompson Publishing Services. ISBN: 032416551

[10] Afkharni, Nozar. 1997. Country Profile: Bulgaria. http://www.kenaninstitute.unc.edu/mbaec/Homepage/Current_Destinations/Bulgaria/bulgaria.html

[11] Afkharni, Nozar. 1997. Country Profile: Bulgaria. http://www.kenaninstitute.unc.edu/mbaec/Homepage/Current_Destinations/Bulgaria/bulgaria.html

[12] International Monetary Fund. 2001. Report on the Observance of Standards and Codes: Bulgaria Update.. http://www.imf.org/external/np/rosc/bgr/update.htm

[13] Sofia News Agency. 2005. S&P Upgrades Two Bulgarian Banks. 2 July 2004. http://www.novinite.com/view_news.php?id=36552

[14] Sofia News Agency. 2005. S&P Upgrades Two Bulgarian Banks. 2 July 2004. http://www.novinite.com/view_news.php?id=36552

[15] Yahoo.com. 2005. Currency Conversion: Bulgarian Lev to the United States Dollar. http://finance.yahoo.com/currency/convert?amt=1&from=BGN&to=USD&submit=Convert

[16] Kim, Taeho. 1999. International Money and Banking. International Thomson Business Press. ISBN: 1861524781

[17] Yahoo.com. 2005. Currency Conversion: Bulgarian Lev to the United States Dollar. http://finance.yahoo.com/currency/convert?from=EUR&to=USD&amt=1&t=2y

[18] Fiduciary Capital Management, Inc. 2005. Why is Stabile Value Attractive. http://www.fcmstablevalue.com/art.htm

[19] Dermine, Jean. 1993. European Banking in the 1990’s. Chapter 1. Blackwell Publishing. ISBN: 0631188436

[20] Burkhardt, Katrin, Strausz, Roland. 2004. The Effect of Fair vs Book Value Accounting on the Behavior of Banks. Free University of Berlin, Germany

[21] Fiduciary Capital Management, Inc. 2005. Why is Stabile Value Attractive. http://www.fcmstablevalue.com/art.htm

[22] Sinkey, Joseph. 2002. Commercial Bank Financial Management (6th Edition). Chapters 5-6. Prentice Hall. ISBN: 0130909106

[23] Rose, Peter. 2002. Commercial Bank Management. Chapter 6. McGraw Hill. ISBN: 025615211

[24] National Bank of Greece. 2005. The Bank. http://www.ethniki.gr/en/bank.asp

[25] National Bank of Greece. 2005. The Bank. http://www.ethniki.gr/en/bank.asp

[26] Shapiro, Alan. 2001. Foundations of Multinational Management. Chapter 15. John Wiley and Sons. ISBN: 0471563374

[27] Governing Council of the Bulgarian National Bank. 2004. Strategy for Bulgarian National bank Development Between 2004 and 2009. Bulgarian National Bank, Bulgaria

[28] Governing Council of the Bulgarian National Bank. 2004. Strategy for Bulgarian National bank Development Between 2004 and 2009. Bulgarian National Bank, Bulgaria

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