nina stoyanova : bank of bulgaria ’ s latest projects in the area of financial services and payments speech by ms nina stoyanova, deputy governor ( banking department ) of the bulgarian national bank, at the opening of the “ innovations ” financial forum, sofia, 14 june 2016. * * * dear colleagues and guests, i would like to welcome you at the financial forum ‘ innovations ’ organised for the third year in a row by the ‘ bank of the year ’ association in partnership with the university of finance, business and entrepreneurship ( vuzf ). the topic of this forum gives us the opportunity to present and discuss the innovations in the financial sector in the area of technologies, banking products and regulations. in this regard, i would like to briefly present the latest projects in the area of financial services and payments, on which the bnb is working. later today our colleagues are going to give you more details on these projects, which will have an impact on the financial sector over the next couple of years. as you are well aware, the legal and regulatory framework of financial services and payments in bulgaria is consistent with all european trends and requirements aiming to achieve an integrated european market, to harmonise the rules and conditions for providing payment services, to promote innovative payment methods, to ensure a high level of security for payments and better consumer protection. • firstly, in the payment services area this year ’ s focus is the transposition into the bulgarian law of directive 2014 / 92 / eu on the comparability of fees related to payment accounts, payment account switching and access to payment accounts with basic features. amendments to the lpsps have been prepared and will be given second reading by the national assembly, together with changes in the regulations. at the same time, the bnb is building a website for comparing fees charged by payment service providers on the most representative services linked to a payment account, and that website will be accessible to all users free of charge. the legal changes will come into effect, in compliance with the directive, as of 18 september 2016. • secondly, regulation 260 / 2012 establishing technical and business requirements for credit transfers and direct debits in euro is going to become applicable to us. the deadline for this regulation to become binding in its entirety and directly applicable to euro - payments in the non - euro area member states is 31 october 2016. as from that date at the latest all credit transfers and direct debits in euro must be made in sepa format, using the

- term interest rates implied by the curve. it is also why the ecb, like many other central banks, typically accompanies its decisions on ( short - term ) interest rates with communication on how it intends, or expects, to set the latter – and other policy instruments – in the future, as this improves its ability to steer the yield curve and thus attain the desired overall monetary policy stance. therefore, the inflation path in the december staff projections was a clear indication that the financial conditions prevailing before that meeting were inconsistent with a timely return of inflation to our 2 % target. in other words, we needed to act and communicate in order to tighten financial conditions further, including by shifting up the interest rate path expected by markets. thus, we raised our rates by 50 bp and, more importantly, we signalled our intention to continue raising them significantly at a steady pace to reach sufficiently restrictive levels, and to keep them there for some time. indeed, after our december communication, there was an upward shift in the risk - free ( ois ) forward curve. 1 in particular, the day before our february meeting, the 10 - year ois rate was 0. 27 basis points ( pp ) higher than before the december meeting, while the 3 - month ois rate was 0. 51 pp higher. equally important, in real terms the 10 - year ois rate was 0. 51 pp higher than in december, once adjusted for market inflation expectations. and the euro had simultaneously appreciated by 2. 88 % against the dollar in the same period. our february decision represents a continuation ( i. e. “ staying the course ” ) of the policy tightening path that we signalled in december. continuing this path was based both on our updated assessment of the inflation outlook and on the financial conditions prevailing in capital markets at that time. let me address each element in turn. as regards the inflation outlook, at our february meeting we did not have the benefit of a new round of staff macroeconomic projections. but as i said before, our assessment of the inflation outlook is based on a wealth of information, which also includes s urvey - based and market - based indicators. in particular, according to the flash estimate, 2 inflation was slightly lower than expected and stood at 8. 5 % in january, down from 10. 1 % in november. furthermore, the strong fall in gas prices, the easing of global supply chain disruptions, the appreciation of the euro and tighter financing conditions ( the