Opinion of the European Central Bank of 24 June 2014 on non-bank financial institutions that provide loans to consumers (CON/2014/45)
Date: 2014-06-24
Institutions: European Central Bank
Subjects: Bulgaria, consumer, consumer credit, financial institution, financial services, financial stability, loan, shadow banking

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 24 June 2014  

on non-bank financial institutions that provide loans to consumers 

(CON/2014/45) 

Introduction and legal basis 

On 22 May 2014, the European Central Bank (ECB) received a request from Българска народна банка 

(the Bulgarian National Bank (BNB)) for an opinion on a draft law on non-bank financial institutions that 

provide loans to consumers (hereinafter the ‘draft law’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning  of  the  European  Union  and  the  third  and  sixth  indents  of  Article 2(1)  of  Council  Decision 
98/415/EC1, as the draft law contains provisions related to the BNB and to rules applicable to financial 

institutions  insofar  as  they  materially  influence  the  stability  of  financial  institutions  and  markets.  In 

accordance  with  the  first  sentence  of  Article 17.5  of  the  Rules  of  Procedure  of  the  European  Central 

Bank, the Governing Council has adopted this opinion. 

1.  

Purpose of the draft law 

1.1  The  draft  law  aims  at  regulating  the  licensing,  supervision  and  activities  of  non-bank  financial 

institutions  that  provide  loans  to  consumers.  It  also  aims  at  enhancing  their  transparency  and 

stability, as well as ensuring confidence in their activities and the protection of consumers’ rights 

and interests. 

1.2  Furthermore, the draft law aims at achieving a clearer distinction between the BNB’s competence 

for the supervision of banks, and the Financial Supervision Commission’s (FSC) competence for 

the  supervision  of  other  institutions  in  the  financial  sector,  including  those  that  provide  loans  to 

consumers. 

2. 

General observations  

2.1  The ECB welcomes the draft law in view of its aims referred to in paragraphs 1.1-1.2 above.  

2.2  The ECB notes that, at present, non-bank financial institutions that provide loans to consumers are 

subject to registration with the BNB. Following the adoption of the draft law, these institutions will 

be  licensed  and  supervised  by  the  FSC.  However,  no  change  is  made  to  the  existing  legal 

1  

Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central Bank by national authorities 
regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42). 

 
 
 
 
 
                                                 
ECB-PUBLIC 

provisions regarding non-bank financial institutions that provide loans to legal entities, which will 

continue to be subject to registration with the BNB.  

2.3  The ECB understands that the new legal framework for the licensing and supervision by the FSC of 

non-bank financial institutions that provide loans to consumers does not entail any transfer of assets 

or existing legal obligations from the BNB to the FSC. The ECB further understands that the FSC 

will use its own resources and procedures for the licensing and supervision of non-bank financial 

institutions that provide loans to consumers. 

This opinion will be published on the ECB’s website.  

Done at Frankfurt am Main, 24 June 2014. 

[signed] 

The President of the ECB 

Mario DRAGHI 

2