Bulgarian subsidiaries of Greek banks are definitely not transferring liquidity to their parents, Dimiter Kostov, deputy governor of the Bulgarian central bank, told reporter on Tuesday on the sidelines of a capital market forum.

The Bulgarian National Bank (BNB) is monitoring the banks and has not noticed indications of irregularities in the banking system, Kostov added. On the contrary, the Bulgarian units of Greek banks are among the good performers in the country. They have much better returns that their parents and it is groundless to think they will ruin their profitability.

The Greek banks are long-term strategic investors on the Balkans, that is why they will not compromise their position by withdrawing from the markets in the region, Moody’s analyst Elena Panayiotou told Bulgarian banking clients on Tuesday, Dnevnik learned. The rating agency expects foreign inflows into the Bulgarian banking system in 2010 to remain at the same level as in 2009.

Rating agency Fitch warned on Monday that the public finance crisis in Greece may have an impact on countries like Bulgaria, where the Greek banks are among the major players on the local financial markets.

On the other hand, central bank governor Ivan Iskrov assured clients of Greek banks operating in Bulgaria that their deposits are safe, countering concerns of finance minister Simeon Dyankov that Bulgarian units of Greek banking groups may be directing liquidity towards their parents.