BAKU, Azerbaijan, November 26. The threshold of financial fortitude for non-banking credit organizations (NBCOs), those commercial entities woven into the fabric of Azerbaijan's economic tapestry, has been elevated, Trend reports.
The requirement was raised from 300,000 manat ($176,470) to one million manat ($590,000) following a new decree signed by Governor of the Central Bank of Azerbaijan (CBA) Taleh Kazimov in connection with "Rules for prudential regulation of NBCO activities" approved by the CBA Board.
According to the decree, the minimum capital for an NBCO set up as a non-commercial legal entity was also determined in the amount of 100,000 manat ($59,000).
Meanwhile, the decree prescribed to determine the structure of the capital in accordance with Article 1.0.7 of the law and include only cash-paid financial instruments in the capital.
When calculating the capital, the following deductions were prescribed to be made from it:
- the net value of intangible assets (taking into account depreciation);
- the amount of deferred tax assets as defined by International Financial Reporting Standards (IFRS);
- investments in the capital of subsidiaries and other legal entities;
- reserves created for satisfactory assets in the calculation of equity are not deducted from the capital.
The CBA Financial Markets Legal Support Department has been tasked to ensure the submission of this decree to the Ministry of Justice of Azerbaijan within three days for inclusion in the State Register of Legal Acts of Azerbaijan.
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