IFC signs agreement with second pilot company as part of ACGP-II

Business Materials 17 June 2009 12:53 (UTC +04:00)

Azerbaijan, Baku, June 17 / Trend , N. Ismayilova/

International Finance Corporation (IFC) has signed agreement with a second pilot company - Azerbaijani Turan Bank as a part of the second stage of the program of technical assistance to introduction of modern corporative governance standards (ACGP), the IFC said.

Turan Bank became first bank to join second phase of the project as CredAgro non-bank credit organization was selected first pilot company.

Turan Bank Director Nazim Sadigov said the bank's involvement in this project will create opportunities for effective cooperation between the managers of the bank sector, which, in turn, will create an opportunity for the bank to respond to processes to be observed in the financial market during and after the crisis.

IFC will conduct counseling and training for directors, managers and major shareholders, will assist to bring the corporate documents in accordance with best practices, to prepare more transparent and open financial reports and will also help to improve internal control and internal audit.

Project manager of IFC Caroline Bright said the results of this project shows that good corporate governance practices can reduce the risks during crisis and ease access to capital in Azerbaijan and other countries around the world.

Turan Bank provides services to the banking market in Azerbaijan for 17 years and the number of customers the bank is about 8,000 people.

The project aims to improve corporate governance practices of companies including commercial banks. The choice of pilot organizations is carried out in accordance with the investment potential and financial prospects of companies and banks and their penchant for reform. Selected companies and banks will be able to participate in a broad program to assess their corporate governance practices, consultations on how to improve relationships between authorities and boards, management and shareholders.

Participation in the pilot the second stage of the pilot program will be paid unlike the first one. Payment will depend on the volume of work. The need for such changes aims to ensure loyalty to the participation of private companies and banks in the ACGP.

The Swiss Economic Relations Secretariat (Seco) will fund the second phase. It has allotted over $4 million.

The corporate governance project assists with introduction of standards of corporate governance in accordance with the rules of the Organization for Economic Cooperation and Development (OECD).

Official opening of the first phase of the project, initiated by IFC and funded by SECO, took place on January 26, 2005. The implementation will take three years with a total budget of $2.1 million.

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