Azerbaijan’s Banking Community to Propound Proposal on Mortgage Legislation

Business Materials 8 August 2008 12:39 (UTC +04:00)

Azerbaijan, Baku, 7 August / Trend corr. I.Khalilova / An expert group on juridical issues at the Azerbaijani Banks Association (ABA) commenced development of proposals on the Mortgage Law, Farhad Aliyev, the chief executive of the Association, said on 7 August. After development, they will be submitted to the Association's presidium for coordination and then will be submitted to the relevant instances.

"Proposals on the mortgage legislation will be the first step in the experts' activity, Aliyev said. The issue aroused great interest at banks and therefore was preferred. Basically, banks offer making technical corrections."

The Law on Mortgage was adopted in 2005 and formation of the normative and legal basis was completed in 2007. But it is still being improved. The National Bank of Azerbaijan (NBA) suggested to the government transfer to the market model of mortgage loaning.

Two groups were established at the NBA - one on juridical and another on loan issues, creation of which is envisaged within the framework of main activity directions and institutional development of the association in 2007-2011.

The expert group on juridical issues will devise proposals on the legislative acts, which regulate banking activity, and the NBA's normative acts. The task of the expert group on loans includes discussion of loaning problems, since during a survey banks mentioned the problems with issuing and return of loans.

The plan on organization of expert groups' activity initially envisaged formation of seven groups, but it is not ruled out that their number will rise in future. Depending on priority, groups will be formed on different directions, including marketing and IT.

Tasks of the expert groups will include development of recommendations and informing the banking associations of the relevant organizations' draft laws or corrections in the normative and legal acts.

On 7 August, the official exchange rate totalled 0.8097 AZN/USD.

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