Azerbaijani Leasing Companies’ Scanty Capitalization Impedes Direct Attracting of Foreign Loans
Azerbaijan, Baku, 28 February / Trend corr I. Khalilova/ Insufficient level of capitalization in the leasing sector of Azerbaijan prevents the International Financial Corporation (IFC) from increasing the volume of financing and direct crediting, the IFC representative in Azerbaijan Aliya Azimova said. The capital of leasing companies averagely comprises $1mln.
"It is difficult to finance Azerbaijani banks for leasing, for they have their own limits for crediting subsidiaries. Therefore, we are still considering what can be done in this field," Azimova said.
According to the IFC terms, the Corporation can finance up to 60% of the joint capital (excluding the subordinated credits).
For this reason, the Fund for Financing of Leasing in Azerbaijan and Central Asia, with the budget of $30mln, allocated $6mln to the Azerbaijani leasing companies - $5mln to Uni Leasing and $1mln to AG Leasing.
Azimova does not rule out the possibility of presenting this year a $5-6mln loan to some company in Azerbaijan, but refused to divulge the company.
"At present, we are actively working within the framework of technical assistance to the development of leasing in the region," she said.
Since the beginning of operation of IFC's technical assistance project in Azerbaijan (2005), it has been rendering the technical assistance to Uni Leasing, AG Leasing and Bank of Baku. Uni Leasing has left the program.
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