BAKU, Azerbaijan, October 19. The revocation of Azerbaijani Mugan Bank's license is not surprising, expert economist Rashad Hasanov told Trend.
He noted that Mugan Bank's risky credit policy, the presence of serious shortcomings in corporate governance and other reasons raised questions about the bank's future activities.
"According to the structure of the loan portfolio, we can see that consumer loans amounted to about 150 million manat ($88.2 million), and business loans - about 280 million manat ($164.7 million). This is not such a big figure in relation to the 22-23-billion manat ($12.9-$13.5 billion) portfolio. It does not mean a big source of funding for businesses. In this regard, I think that the withdrawal of the license from the bank will not affect the country's banking sector," the expert said.
The license of Mugan Bank was revoked on October 19, 2023, by the decision of the CBA Board dated October 18, 2023, in accordance with Articles 16.1.6, 16.1.7, 16.1.9, 16.1.18, 57, and 61. 1 of the Law of the Republic of Azerbaijan "On Banks" (the amount of total capital is less than the minimum amount established by the legislation for banks, the ratio of total capital adequacy is less than 3 percent, the bank does not carry out its current activities in a reliable and prudent manner, as well as due to inadequate internal management and control procedures of the bank).