Dear clients,

With this notification, BACB provides information regarding the redenomination of financial instruments in connection with the introduction of the euro:

Pursuant to the Law on the Introduction of the Euro in the Republic of Bulgaria, published in State Gazette No. 70 of 20.08.2024 (the Euro Law), as of the date on which the euro is introduced as the official legal currency in the Republic of Bulgaria, all financial instruments denominated in Bulgarian lev and owned by the Bank's clients shall be automatically redenominated from BGN to euro, in accordance with the general principles and rules laid down in the Euro Law.
According to the general rules for redenomination and rounding under the Euro Law, the redenomination from BGN to euro shall be carried out by dividing the numerical value in BGN by the full numerical value of the official exchange rate, expressed with six digits, including all five digits after the decimal point.
The resulting amount in euro shall be rounded to the second digit after the decimal point, based on the third digit after the decimal point, according to the following mathematical rule:

• If the third digit after the decimal point is less than 5, the second digit remains unchanged;
• If the third digit after the decimal point is equal to or greater than 5, the second digit is increased by one.

The redenomination of financial instruments from BGN to euro shall be carried out in accordance with the rules described in the Euro Law, as follows:

The market operator, or respectively the investment intermediary organizing a trading venue, shall redenominate from BGN to euro the market value of dematerialised financial instruments admitted to trading on a trading venue, in compliance with the general rules for redenomination and rounding under the Euro Law, unless special rounding rules for the relevant financial instrument are provided for by law or by an act of the European Union.
"Central Depository" AD shall automatically redenominate from BGN to euro the nominal value of dematerialised financial instruments registered in the central securities register, in compliance with the general rules for redenomination and rounding.
All transactions and operations with dematerialised financial instruments shall be suspended three business days prior to the date of introduction of the euro in the Republic of Bulgaria. Transactions and operations shall resume on the first business day following the introduction of the euro. All settlement systems shall provide for the possibility of executing transactions in euro as of that date.

Shares

The redenomination of the nominal value of shares and the redenomination of the capital of commercial companies shall be carried out in a manner that does not affect the rights of shareholders and their shareholding in the capital.
The nominal value of 1 share shall be redenominated from BGN to euro in accordance with the general rules for redenomination and rounding under the Euro Law.
The total number of shares held by the client shall not change following the redenomination of the nominal value of 1 share.

Debt securities other than government securities (Bonds)

The total nominal value of 1 bond issue shall be redenominated from BGN to euro in accordance with the general rules for redenomination and rounding under the Euro Law.
The nominal value of 1 bond in euro is determined by dividing the total nominal value of the bond issue, calculated in euro, by the number of bonds in the issue.
The redenomination does not affect the rights and obligations of the issuer and the holder.

Government Securities (GS)

The nominal value of all GS denominated in BGN shall be redenominated once from BGN to euro, in accordance with the general principles and rules for redenomination and rounding.
The redenomination of nominal values for each individual account and each GS issue shall be carried out by the Bulgarian National Bank.
In the issued registered certificates of ownership of GS in BGN, the values shall be deemed to be values in euro, in accordance with the general rules for redenomination and rounding. The certificates shall remain valid until the final repayment of the claims of the persons named therein, arising from ownership rights over GS from the respective issue.
The market value in euro of GS initially issued in BGN shall be determined based on the redenominated nominal value of the government securities and shall be calculated per 100 units of nominal value with two digits after the decimal point.

Collective Investment Schemes, National Investment Funds, and Alternative Investment Funds

On the first business day from the date of introduction of the euro in the Republic of Bulgaria, the net asset value (NAV) of a collective investment scheme in euro shall be calculated by redenominating the NAV in BGN as at the end of the previous business day in accordance with the general rules for redenomination and rounding under the Euro Law.

The NAV per share in euro shall be calculated by dividing the redenominated NAV referred to in the first sentence by the number of shares in circulation, and the resulting value shall be rounded to the fourth digit after the decimal point as follows:

• Where the fifth digit after the decimal point is less than five, the fourth digit remains unchanged;
• Where the fifth digit after the decimal point is equal to or greater than five, the fourth digit is increased by one.

The issue value of 1 share in euro and the redemption price of one share in euro shall be rounded in accordance with the above rule, second sentence.
The above rules shall apply accordingly to national investment funds and alternative investment funds.

For all other activities, services and products, BACB will publish additional information in stages.

Sincerely yours,
BACB