Fibank eyes Greek market as part of bold regional expansion

The First Investment Bank (Fibank), Bulgaria’s largest bank with local capital, has announced plans to expand into new European Union markets, starting with neighboring Greece. The lender, which already operates in Cyprus and Albania, said it views Greece as a natural next step due to shared borders, rising trade volume, and Bulgaria’s deepening EU integration—now bolstered by its recent entry into the Schengen area.

Fibank’s leadership emphasized that the move aligns with a broader strategic goal to strengthen the bank’s regional footprint and capitalize on emerging opportunities in Southern Europe.

“Data from the first quarter show a clear trend of growth, a stable capital position, and high operational efficiency,” said Fibank CEO Nikola Bakalov.

Fibank CEO Nikola Bakalov (Credit: Fibank)

“The bank is not only maintaining its strategic positions but is also well-prepared to capitalize on new market opportunities in a dynamic economic environment.”

Solid Financials Underpin Expansion Strategy

The bank’s financial performance in recent quarters supports its ambitious push. In the first quarter of 2025, Fibank posted a consolidated net profit of BGN 55.9 million (€28.6 million), with earnings per share reaching BGN 0.37. The standalone net profit surged to BGN 49.6 million, up sharply from BGN 18.7 million during the same period in 2024.

For the full year 2024, the bank reported a pre-impairment profit of BGN 363.4 million—an increase of over 12% year-on-year—driven by stronger operational income and enhanced risk controls. Total banking income climbed to BGN 613.2 million, while total assets rose by 13.4% to BGN 16.9 billion, securing Fibank’s spot as Bulgaria’s fifth-largest bank by assets, with an 8.22% market share.

Its stock has also responded positively, appreciating nearly 20% since the beginning of the year and reaching BGN 5.10. In January, Fibank was named “Most Liquid Issuer” in the Premium and EUROBRIDGE segments on the Bulgarian Stock Exchange (BSE).

Challenges Remain: Asset Quality Under Scrutiny

Despite the strong numbers, international ratings agencies continue to flag concerns. Last month, Fitch Ratings reaffirmed Fibank’s Long-Term Issuer Default Rating at ‘B’ with a Stable Outlook, citing “reasonable domestic franchise” and “adequate liquidity,” but also highlighting persistent asset quality issues.

Fibank’s impaired loans ratio stood at 12.6% at the end of 2024, significantly higher than regional peers, with loan loss allowances covering only 32% of these impaired assets. A large stock of foreclosed properties and underperforming loans still weighs on the balance sheet. Analysts expect modest improvement, but the challenges are expected to persist into 2026.

The bank’s Common Equity Tier 1 (CET1) ratio improved to 18% in 2024, yet nearly half of this capital remains encumbered by unprovisioned problem loans—an issue that could constrain future lending capacity if not addressed.

Looking Ahead: A Calculated Risk

Fibank’s expansion into Greece is not just about geography. It’s a test of its resilience, capital strength, and ability to navigate a competitive and mature banking market. With solid profitability, growing investor confidence, and deepening regional integration, the timing may be right. But success will depend on how well Fibank addresses its legacy asset issues and adapts to stricter Eurozone regulatory standards.

If managed carefully, the move could mark the beginning of a new chapter—positioning the bank as a rising regional player beyond Bulgaria’s borders.

Fibank at a Glance

Year founded: 1993 Headquarters: Sofia, Bulgaria Employees: approx. 3,200 Revenue: BGN 613.2 million (€314.2 million) Stock Listing: Bulgarian Stock Exchange (BSE: 5F4)