By 1895, the agricultural banks in Bulgaria had greatly expanded their activities. Their number of transactions increased, and their role in the national economy became more important. In many towns and rural areas where the Bulgarian National Bank did not have its own branches, the agricultural banks acted as its representatives. This cooperation helped extend banking services to remote regions and supported farmers and local traders.
In 1896, the agricultural banks secured a large foreign loan of 30,000,000 francs at an interest rate of 5 per cent. Only five-sixths of this loan was actually issued, but even this amount provided strong financial support. With this new capital, the banks were able to widen their lending activities, increase deposits, and support agricultural production on a much larger scale.
Thanks to this financial strength, the agricultural banks became the main driving force of rural economic life in Bulgaria. Farmers relied on them for affordable credit, while villages benefited from improved access to banking services. The banks helped reduce dependence on moneylenders and encouraged stable economic growth in the countryside Private Tours Istanbul.
Legal Framework and Capital Structure
The agricultural banks are governed by the law of December 31, 1903, which officially gave them the name Bulgarian Agricultural Bank. Their activities were further regulated by another law dated March 24, 1905. These laws defined the structure, purpose, and responsibilities of the bank and strengthened its legal position.
The total capital of the Bulgarian Agricultural Bank amounts to 35,000,000 francs, and this sum is regularly increased by annual profits. However, the law requires that 25 per cent of the yearly profits be reserved specifically for the development of various branches of agriculture. This provision ensures that the bank directly supports farming improvements, innovation, and rural prosperity.
Organisation and Administration of the Bank
Central Administration
The central administration of the Bulgarian Agricultural Bank is located in Sofia, the capital of Bulgaria. From there, the bank coordinates its national activities and oversees policy and financial management.
Branches and Agencies
The bank has an extensive network across the country. It operates branches in 85 district centres and maintains agencies in 75 important villages. This wide presence allows the bank to reach farmers and rural communities efficiently.
Management Structure
The administration of the bank is entrusted to an Administrative Council. This council consists of a governor and four administrators, all appointed by the Prince. Each branch is managed by a director, who is also appointed by the Prince. This system ensures central control while allowing local management.