TBI Bank plans to return to the Bulgarian bond market with a new MREL-eligible issue in the second half of October 2025. While the size and coupon are not yet confirmed, the bank indicates the terms will be similar to its early-2025 placement—a note with an approximately 3.5-year tenor and a 7.6% coupon.
Refinancing Moves: Lowering the Cost of Capital
Earlier this year TBI Bank placed a 7.6% MREL bond and then exercised the issuer call on a prior 9.5% MREL issue (originally placed December 2023, maturity September 2026, €10 million). Redeeming the higher-coupon notes reduces interest expense and streamlines the maturity profile.
Track Record on the Bulgarian Market
Over the past four years, TBI Bank has established itself as a leading corporate bond issuer in Bulgaria. By offering investors attractive, flexible terms across different maturities and yields, the bank has raised a total of €84 million through several public placements.
All TBI Bank bond issues are listed and traded on the Bulgarian Stock Exchange (BSE), providing transparency and access for institutional and private investors.
What Is an MREL Bond?
MREL—the Minimum Requirement for own funds and Eligible Liabilities—is a regulatory buffer intended to ensure banks can absorb losses and be resolved without taxpayer support. For issuers, MREL instruments help meet regulatory targets; for investors, they are senior instruments with defined eligibility features.
Portfolio View — Bulgaria Fund Management
From a portfolio-construction standpoint, Bulgaria Fund Management views the forthcoming TBI Bank MREL placement as a potential addition for diversification within the existing bonds sleeve. While a high single-digit coupon can imply higher risk, Moody’s currently rates TBI Bank in the Ba2 range with a Stable outlook (sub-investment grade). The bank’s business model is concentrated in retail/consumer finance, including point-of-sale and small-ticket lending (e.g., household appliances and similar purchases), where unsecured lending rates often exceed 15%—supporting margins but also requiring disciplined risk management.
This article is for information only and does not constitute investment advice or an offer to buy or sell securities.
