Control in Non-Banking Financial Sector

This set of vocabulary flashcards covers the organizational structure, regulatory framework, and key legal definitions of the non-banking financial sector in Bulgaria based on the FSC Act, Social Insurance Code, and POSA.

Non-banking financial sector

A sector consisting of three primary activities: investment activity, insurance activity, and social insurance activity.

Socially insured persons (Bulgaria 2025/2024)

There are approximately $5$ million people insured, with funds per person valued at $6.5$ ($5.5$) KBGN.

Investment intermediaries (Bulgaria 2024)

A total of $57$ entities, consisting of $19$ banks and $38$ non-banks.

Special investment purpose companies (АДСИЦ)

Entities in Bulgaria that, as of 2024, numbered $49$ with $2 \text{ billion BGN}$ in assets managed.

Financial Supervision Commission (FSC)

The body established by the Financial Supervision Commission Act to regulate and supervise securities markets, insurance, and social insurance sectors.

FSC Composition

The Commission consists of $5$ members: a Chairperson, three Deputy Chairpersons (Investment, Insurance, and Social Insurance departments), and one member for risk analysis and consumer protection.

Methods of FSC Supervision

Supervision is exercised through the issuance of licenses/approvals, conduct of off-site and on-site inspections, and application of coercive administrative measures and sanctions.

Supplementary social insurance

Insurance implemented through participation in universal or occupational pension funds, voluntary retirement funds, or vocational-training insurance funds.

Retirement insurance company

A licensed joint-stock company whose objects are limited specifically to supplementary retirement insurance.

Minimum capital for a pension insurance company

The required minimum amount of capital which must be fully paid up in cash is $3,750,000 \text{ EUR}$.

Qualified holding

Any direct or indirect holding amounting to $10$ per cent or more of the capital or voting rights, or which allows significant influence over management.

Responsible actuary

A natural person with a licensed competence recognized by the Commission who manages and is responsible for the actuarial services of a pension company.

Custodian bank

A single bank where all assets of a supplementary compulsory or voluntary retirement insurance fund must be kept based on a contract for services.

Public company (Bulgaria)

A joint-stock company that has its shares recorded in the FSC register for trading on a regulated market or has more than $10,000$ shareholders on the last day of two successive years.

Central Depository AD

A joint-stock company that operates a securities settlement system and keeps the central securities register.

Investment firm

A person providing investment services such as executing orders for clients, portfolio management, investment advice, or dealing in financial instruments on own account.

Regulated market

A licensed multilateral system managed by a market operator that brings together multiple third-party buying and selling interests in financial instruments.