SOFIA (Bulgaria), August 30 (SeeNews) - Bulgaria's talks with the relevant EU authorities to join the Exchange Rate Mechanism II (ERM II), the "waiting room" for the adoption of the euro, is definitely credit positive news, Raiffeisen Research said on Tuesday.

Local media reported over the weekend that during a meeting with German Chancellor Angela Merkel, Bulgarian prime minister Boyko Borissov had requested that the country enter the ERM II mechanism.

"[Entering] the Eurozone waiting room is a very important political decision and it would be good for Bulgaria. To date, it does not bear any commitments on the part of the state. We meet the criteria," Borissov said, as quoted by the government press service on Monday.

Commenting on these developments in a daily note, Raiffeisen Research said the recent banking sector stress testing exercise increased the probability that the Bulgarian bid might be considered, however adding that the ERM II accession is largely a political decision "based on rather unclear, i.e. less indicator-based, consultations."

In August, Bulgarian central bank said that an asset quality review (AQR) and stress tests of Bulgarian banks showed the capital adequacy of each bank after potential adjustments from AQR remains above the minimum regulatory requirements.

Once the country has entered the ERM II a rather quick euro area entry would follow within 2 to 2.5 years as a done deal given the prevalence of stability-oriented economic policies as well as a rather broad-based support, Raiffeisen Research also said.

"Therefore, there could be some positive effects on longer-dated Eurobonds although the Bulgarian sovereign risk pricing is already rather tight," it concluded.