The Bulgarian Association of Banks (ABB) today published answers on its website to the five claims about bank profits that are repeated most often. It was prompted by the government's proposal for a one-off tax on windfall profits in several sectors, including banking.
ABB says some claims repeated in public debate are not always complete. "Our aim is to bring more clarity and context to the public discussion about banks and their role in the economy," the publication says.
At the end of September, Bulgarian National Bank governor Dimitar Radev warned against the extra tax. He said it could make loans more expensive or harder to get, limit private investment and raise the cost of government borrowing, meaning the money the state takes on loan.
In a statement at the start of October, ABB also opposed the levy. It says there are no grounds to speak of excess profit. It says the measure threatens banks' ability to finance the economy, undermines equal treatment and legal certainty, and goes against national and European law.
ABB disputes the claim that bank profits jumped by 588%, citing data over several years. Banks earned €0.82bn in 2019 and €1.85bn in 2025, while in the pandemic year 2020 profit fell 51% to €0.42bn. The rise from 2019 to 2025 is far below 588%, the association says.
If the crisis year 2020 is used as the base, the rise looks bigger, but even from €0.42bn to €1.85bn it stays far below that figure. Assets, capital, the loan portfolio and GDP all roughly doubled between 2019 and 2025. ABB says profit is growing at the same pace.
The association says fees do not bring in half of the profit, because they are only part of non-interest income, that is, income the bank does not earn from interest. According to the European Banking Authority, this income is 19.5% of the total for the whole banking system in Bulgaria and 28.6% on average for the EU and the European Economic Area. Besides fees, it includes income from advice, asset management, brokerage and custody services, placing bond and share issues, and sales of investment products. So customer fees are a small share of that 19.5%, ABB says.
A 2025 survey by the association found that digital transfers cost up to 5.4 times less than paper ones, and they make up more than 76% of the system. If a customer pays for services one by one at the standard rates, the price is more than 6 times higher than with a subscription package.
ABB also disputes the claim that 45% of profit is sent abroad as dividends. Between 2020 and 2022, banks were not allowed to pay dividends because of the pandemic crisis. Since 2018, their investment and reinvestment through growth in their own capital has exceeded €5.5bn, or more than 70% of profits for the period. The association says that out of every €1 of profit, 70 cents were invested and reinvested in Bulgaria.
Profits do not come from high interest rates, ABB says. In 2022 many countries raised rates, while banks in Bulgaria kept cutting them. At the end of the first half of 2026, home loans in Bulgaria cost 2.75% a year, measured by the annual percentage rate of charge, which covers the full cost of a loan for one year. ABB says this is the lowest level in the eurozone. The interest rate on new home loans is 2.41%, and the association says mortgages in Bulgaria are the most affordable in Europe.
In reply to the criticism that banks do not give enough back to society, ABB gives several examples. During the pandemic, banks put off payments on loans worth more than €5bn under a private moratorium. The association says customers could skip instalments until their business and activity returned to normal.
To prepare for the eurozone, banks put in their own financial, technology and staff resources worth more than €255m. ABB says the sector led the way in joining the eurozone and ensured a smooth changeover. Since 2024, under the global minimum tax, banks have owed 50% more tax than other taxpayers.
The association calls banks among the biggest taxpayers and a big buyer of government securities, which helps the state finance its debt on good terms. Banks lost about €450m when those securities fell in value between 2020 and 2022. ABB says the contrast between those losses and the recovery that followed was also used to define the supposed "windfall profit".