World Financial Crisis Passes by Azerbaijanїs Credit Unions: Association

Business Materials 25 September 2008 13:00 (UTC +04:00)
World Financial Crisis Passes by  Azerbaijanїs Credit Unions: Association

Azerbaijan, Baku, 25 September / Trend corr. U.Ismayilova/ Financial crisis did not affect Azerbaijanїs credit unions and they do not face shortage of funds, Elchin Bagirov, Azerbaijan Credit Union Association Chairman of the Board, said on 25 September.

їOnly those unions which fail to receive money due to weak activities are experiencing shortage of funds. And that is in no way connected with the financial crisis,ї said Bagirov.

According to Bagirov, all remaining active credit unions are still operating and receive funds from the World Bank (WB) within a joint project and from other investors.

Main bulk of funds go to the Association within the Agricultural and Credit Development project of Azerbaijani Government and WB, on which Azerbaijan has received $10mln and is expected to receive $8mln this year for agricultural development.

їWB is the only foreign investor of Azerbaijanїs credit unions. All remaining donors are local; that is why the crisis did not affect their activities,ї said Bagirov.

Mortgage lending rate has lately decreased in Azerbaijan. And several banks stopped allocation of loans. The National Bank of Azerbaijan (NBA) did not officially order Azerbaijani banks to suspend mortgage lending. The banks cut lending first of all due to the crisis in the world financial markets. The situation makes the banks be more prudent and apply strict selection during client lending, which is a part of the corporate governance.

Five credit unions and several individuals established the Credit Union Association of Azerbaijan (AKIA) at the end of 2003. More credit unions operating in Azerbaijan joined the Association later. The Association unites 51 credit unions of over 70 operating in the country.

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