Annex 5
THE BULGARIAN RATING
AGENCY
New Horizons for Rating Services
in Bulgaria
With the support of the Ministry of Economy of the Republic of Bulgaria
Our Mission
The Bulgarian Rating Agency is an integral
part of the infrastructure supporting the
smooth operation of the national financial
markets, providing the integrity and
transparency, which makes markets work.
BRA provides a public service – free,
available, accurate and useful information,
compressed into a standard ratings scale, on
many market participants, to all market
participants.
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Our Vision
The Bulgarian Rating Agency (BRA) is established with the
primary goal of being the leading national rating institution in
Bulgaria, with strong brand name based on sustainable
performance.
BRA helps create an investor-friendly environment, based on
quality, thoroughness and accuracy of work. BRA sets the
standards and provides benchmarks for the investment
community in Bulgaria.
BRA focuses on providing accurate, comprehensive and useful
assessments of risks, well-communicated among all market
participants.
BRA intends to develop a leadership role in the implementation
of cutting-edge technologies for risk assessment of companies
operating in the region.
BRA is determined to maintain high working standards,
employing motivated and well-trained team of professionals.
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Our Goals
BRA intends to combine the right people, products
and methodology, with the goal of producing rating
services in Bulgaria, by providing accurate and
thorough information to the financial markets and the
investment community in general.
BRA will use a rating methodology suitable for
servicing the Bulgarian business environment and
compatible with the services provided by the leading
rating companies worldwide.
BRA will provide value-added services on the base of
data warehousing in strategic partnerships with other
private and public institutions.
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Our Shareholders
The Bulgarian Rating Agency AD is established
as a limited liability company with the support
of the Government through the Bulgarian
Export Insurance Agency. Our shareholders are:
The Bulgarian Export Insurance Agency AD

Established by a special law in 1998 and owned 99.995% by
the Government, BEIA is the only entity to insure risks for
Bulgarian exporters. It holds an insurance license. 25% stake.
BRAVO Investments Ltd.

A newly-established SPV. 75% stake.
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Our Board of Directors
Mr. Toshko Georgiev – Chairman

Currently CFO of Boni Oborot Holding AD. A career banker, Mr. Georgiev
holds a number of post-graduate qualifications from institutions in the USA,
Europe and Japan.
Mr. Nicola Yankov

Currently Deputy Minister of Economy. Mr. Yankov has a degree in
Economics from Cornell University, and has worked consecutively as country
treasurer for Kraft in Bulgaria, as CFO of Solvay in Bulgaria and as CEO of
Naftex in Bulgaria.
Mr. Petrozar Petkov

Currently CEO of the Bulgarian Export Insurance Agency AD. For the last
few years Mr. Petkov has served as a director in Allianz Bulgaria.
Mr. Dimitar Valkov

Currently Regional Director of Hebrosbank AD for Eastern Bulgaria. Mr.
Valkov has extensive experience in the financial industry. For the last few
years he has lead the Trade Finance Division of BNP-Paribas Bulgaria.
Mr. Bojidar Arshinkov – Executive Director

Former Regional Director of Hebrosbank AD for Western Bulgaria, Mr.
Arshinkov has also worked for Demirbank. He currently heads the RIME
Information Bureau (Dun & Bradstreet correspondent for the region).
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Rules on Operations
Independence of the functions related to rating
determination, guaranteed by the Ratings Committee. The
Ratings Committee is an independent body of the Agency.
It does not report to the Board of Directors for the
outcome of their work and for a determined rating grade.
It consists of well-known practitioners and experts in the
financial and industrial sectors.
Compressing the analyses of companies and risks into a
standard scale of ratings, allowing comparison with the
results of the leading rating agencies worldwide.
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Our Core Business Is
Assessing Ratings on:
1. Industrial Enterprises

They are the main borrowers at present. Banks supply almost 100% of the financing to the industrial
enterprises in Bulgaria. The trend moves to debt issues as the industrial sector aims to attract
funding on the capital markets. Some of the biggest industrial conglomerates state as their goal the
launching of corporate bonds in the next two years.
2. Municipalities

They have the right to finance their investments by issuing bonds on the capital market. The current
trend of deregulation and decentralization will contribute to the development of new sources for
financing used by local municipalities.
3. Financial Institutions

They are not only the main users of rating services, but also the subjects of rating. A rating is
contributing to the integrity of a financial institution in front of the investment community worldwide.
Ratings contribute to the development of financial services such as trade finance and forfeiting. The
ongoing process of privatization, and changes in the ownership structure is another ratings demand
driver.
4. Issues of Bills and Bonds

Ratings aim to assess risks linked with different obligations of an economic entity. Bills rating
contributes to the development of factoring services in Bulgaria.
5. Project Financing

Ratings require analytical depth to understand new financial techniques and transactions in order to
submit long-term assessment over the quality of a project.
6. Investment Funds

Will be developed with regard to the newly-established Pension and Venture-capital Funds. A fund
rating is assigned to a financial entity bearing collective investments with the goal to evaluate its
ability to pay back and further increase all received and invested capital, excluding own capital.
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Side Business Supporting
Our Core Services: (1)
1. Risk Management Services





Estimates of credit default probabilities
Portfolio analysis
Loan pricing services
Outsourcing elements of the decision-making in crediting processes
More than 7,000 credit applications will be rated before the end of 2003
2. Data Warehousing



Provides platform for better implementation of economic models
Focus on using real data collected from the industry participants
Maintain information on more than 50,000 active companies in Bulgaria
3. Payment Habits and Counterparty Risks


Analysis of the value chain and the relationships between buyers and
suppliers
Analysis of correlated risks imposed by group companies
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Side Business Supporting
Our Core Services: (2)
4. Business Planning



Strategy development
Consulting
Financial advisory services
5. Market Reporting



Industry specifics
Macro data
Business intelligence
6. Indexing



Stock market
Secondary debt market
Local commodity market
7. Benchmarking and Comparative Analysis Reports
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Our Partners
We are proud to benefit from strategic partnerships and
cooperation agreements with:
The
The
The
The
The
The
The
The
The
The
National Statistical Institute
Customs Agency
National Tax Service
Bulgarian Export Insurance Agency
Agency for Collection of Public Receivables
Privatization Agency
Ministry of Justice
Ministry of Economy
Bulgarian National Bank
National Center for Information and Documentation
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Why Does BRA Need
Donor Support
BRA provides a public service.
BRA is indispensable to the national financial
and capital markets – without accurate and
reliable information, without integrity and
transparency, there is no market.
BRA is not intended to be a profit-oriented
enterprise in the near future, therefore
private financing is difficult to obtain.
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Start-up Costs
BRA needs donor support for its start-up
costs. The details (in USD):





Office renovation
Furniture
Equipment
Specialized Software
Other (website, training etc.)
TOTAL START-UP
36,000
51,000
189,000
550,000
200,000
1’026’000
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Project Timeframe
BRA intends to launch fullscale
operations by mid 2003. First ratings
will be produced with the help of
outside partners (outsourcing). Own
staff will be retained after substantial
part of the start-up costs are invested
and a suitable working environment is
created.
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THE BULGARIAN RATING
AGENCY
www.bra.bg
Welcome to a new market full of
growth opportunities!
office@bra.bg