The Bulgarian National Bank (BNB) has announced that it will join TARGET2*, a real-time gross settlement system (RTGS) for Euro transactions, on February 1, 2010.

The system, master-minded by the European Central Bank, provides for real-time processing, settlement in central bank moneys, and immediate finality.

BNB announced on Friday that this move represented a significant step for Bulgaria’s integration into the European financial market and settlement structure.

The Bulgarian component, TARGET2-BG, includes the central banks, another 16 banks and an auxiliary system for settlements of up to EUR 50 000 that may be effected at a particular set time.

When BNB actively joins the system, TARGET2 will incorporate 23 EU member staes, of which six – including Bulgaria - are countries outside the Eurozone.

BNB stated that being part of TARGET2 would ensure state-of-the-art mechanisms for stability and non-interruption of business processes, as well as for monitoring and managing liquidity in Euro, plus cost efficiencies that would improve payment settlement processes and increases the speed and security of payments.

The Bulgarian Finance Minister, Simeon Djankov, has announced, also on Friday that the government’s top priority of its foregn policy over the next six months is its application to join the exchange-rate mechanism, the two-year currency stability test prior to euro adoption in 2013.

*TARGET2 - The Trans-European Automated Real-time Gross Settlement Express Transfer (TARGET) 2 system was launched in November 2007.