Azerbaijani Texnikabank has no plans to merge with other banks

Azerbaijani Texnikabank has no plans to merge with other banks

Baku, Azerbaijan, Feb. 4

By Anvar Mammadov - Trend:

Azerbaijani Texnikabank, the license of which was revoked by the Central Bank of Azerbaijan, has no plans to merge with other banks, Chairman of the bank's Supervisory Board Etibar Aliyev told Trend Feb. 4.

The Central Bank of Azerbaijan (CBA) revoked the license of Texnikabank OJSC Feb. 2.

This decision was made because the total capital of the bank didn't correspond to the CBA minimum requirement of 50 million manats. The total capital adequacy ratio amounted to three percent [the CBA minimum requirement is 10 percent].

The bank couldn't fulfill its obligations to creditors and didn't manage its current activity prudentially. Temporary administrator was appointed at the bank since Feb. 2.

Aliyev said that the bank is not going to litigate the decision of the central bank regarding the revocation of the license.

"After revocation of license, the bank has two ways: to litigate the decision of the central bank or to accept it," he said. "It was only last week when I was asked about the bank's actions in the case of revocation of the license, and I said I don't believe that the Central Bank of Azerbaijan will do it, but if that happens, I won't litigate the central bank's decision. I would like to add that Texnikabank is not going to consolidate with other banks."

At the same time, Aliyev noted that the bank doesn't agree with the decision of the Central Bank of Azerbaijan, although did accept it.

"The bank was functioning normally, and we had all the possibilities to ensure the creditors' claims," said the head of the bank's Supervisory Board. "I consider it wrong to revoke the bank's license, which is not encumbered by obligations, but I respect and accept that decision."

He went on to add that the decision to revoke the bank's license shouldn't affect activities of its subsidiaries - Alfa Insurance company and Kapital Menecment OJSC, which has a license for broker, dealer and underwriting activity.

The bank is a wholly shareholder of the both companies, he said.

"Both companies continue their activities," Aliyev said. "At the moment they continue to function, and it is too early to speak of any changes."

He added that the bank has all the necessary funds to fulfill the claims of creditors.

"The insured portion of bank deposits will be returned by the Azerbaijan Deposit Insurance Fund (ADIF)," Aliyev said. "Regarding other commitments, they will be covered through the bank's assets. But this process may take some time, since, in accordance with the law, there should be the court's decision and a liquidator should be determined."

Currently, some 36 banks have banking activity licenses in Azerbaijan. The CBA has revoked the licenses of six banks since early 2016 [Bank of Azerbaijan, Gence Bank, United Credit Bank, Atra Bank, Caucasian Development Bank and Texnikabank].

Texnikabank has been operating in Azerbaijan since 1994 (previously - Rashadbank).

Until now, the bank's shareholders comprised of Beaufort Investissements S.A investment company [head office is located in Luxembourg] with interest of 78.4421 percent, while 21.5579 percent belonged to physical entities.

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