Azerbaijan, Baku, Jan. 14 / Trend , N.Ismayilova /
The Association of Leasing Companies of Azerbaijan (ALCA) has extended its membership by accepting two organizations, Chairman of ALCA Elchin Ahmadov said.
The new members of the Association are Kavkaz Leasing and Azerdemiryolbank, which launched offering leasing services from this year.
"Two other organizations are also expected to enter the Association. Now they are represented in the organization as supervisors," Ahmadov said.
Before accepting the aforesaid two organizations to Association's membership, there were seven leasing companies - AGLeasing, AtaLeasing, Bank of Baku, non-credit organization of CredAgro, Jointleasing, Texnikaleasing and UniLeasing.
[The Association of Leasing Companies of Azerbaijan was established under the project of the International Financial Corporation (IFC) on technical assistance to development of leasing in Azerbaijan in 2005.]
In total the number of companies and banks occupied in leasing in Azerbaijan exceeds 20. However, only five or six companies are active. This is explained with lack of well specialized staff in this sphere. The number of leasing companies will grow after banks will make decisions to establish leasing departments or subsidiary companies.
Due to inactive leasing operations ALCA's membership was decreased from 12 to 7. Some of excluded members of the Association may be returned as they will make their operations active.
The low rate of capitalization in the leasing sector in Azerbaijan does not allow IFC increasing its finance and to credit companies directly. Leasing companies' capital is $1 million. By IFC terms, it may finance only 60 percent of the aggregated capital (without subordinated loans, which is taen into consideration in the capital of second rate).
Due to these reasons $6 million was invested in the Azerbaijani leasing companies -Uni Lieasing and AG Leasing $5 million and $1 million respectively from the Leasing Financing Fund in Azerbaijan and Central Asia with $30 million budget.
Since the launch of the IFC assistance project in Azerbaijan in 2005, its key activity was a technical assistance to Uni Leasing, AG Leasing and Bank of Baku, although it offers consultations to other leasing companies, as well.
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