Bulgaria Enters The Eurozone As The 21st Member State
Bulgaria formally adopted the euro today, marking a significant step in its deeper integration with the European Union. Euro banknotes and coins began circulating in Sofia as the country completed its transition to the single currency.
The fixed conversion rate was set at 1.95583 lev for 1 euro, reflecting the rate preannounced in July. Christine Lagarde welcomed Bulgaria to the euro area and greeted central bank governor Radev as he assumed his seat on the ECB Governing Council.
The ECB illuminated its Frankfurt headquarters to celebrate the expansion of the currency union, underscoring a milestone for the 358 million Europeans who now share the common currency.
Bulgaria’s National Bank entered the Eurosystem as a full member and secured a place in the ECB’s Governing Council, strengthening the country’s role in shaping monetary policy.
Integration Into The Single Supervisory Mechanism
The Bulgarian National Bank became a full participant in the Single Supervisory Mechanism after several years of close cooperation that began in 2020. The ECB now directly supervises 4 significant institutions in Bulgaria and oversees an additional 17 less significant ones.
Its supervisory responsibilities include licensing banks and assessing acquisitions of qualifying holdings. A representative of the Bulgarian central bank joined the ECB’s Supervisory Board as part of the country’s expanded role.
Capital Contribution And Eurosystem Participation
The Bulgarian National Bank completed its capital contribution to the ECB and transferred its share of foreign reserves. Bulgarian counterparties will gain access to ECB open market operations from 1 January 2026.
The ECB will soon publish lists of Bulgarian credit institutions and branches subject to minimum reserve requirements, along with lists of Bulgarian branches operating in euro area member states.
Transitional provisions for minimum reserves were announced in October 2025, and assets in Bulgaria that meet eligibility standards will be added to the eurozone collateral framework.
Expansion Into TARGET Services
Bulgaria joined the TARGET services suite today, enabling the seamless movement of cash, securities and collateral across Europe. Participation covers T2 for payments, T2S for securities settlement, TIPS for instant payments and ECMS for collateral management.
The country had already adopted T2S in 2023 and TIPS in 2024, and the migration of counterparties proceeded smoothly, ensuring all services started operating without disruption.
New Rotating Voting System Takes Effect
The ECB introduced a new rotating voting system in its Governing Council today as part of the expanded membership structure.
