ABA president: Azerbaijani banking system has successfully built relations with int'l financial institutions (INTERVIEW)

ABA president: Azerbaijani banking system has successfully built relations with int'l financial institutions (INTERVIEW)

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

Azerbaijan's dynamic development calls for accelerating systemic banking sector reform, including the introduction of new banking technologies, expansion of banking services and wider involvement of economic actors to banks handling funds. Commercial banks should work together to solve common problems, enhance cooperation with governmental and non-state structures and actively establish business relations with international financial institutions to successfully implement these tasks. The Azerbaijani Banks Association (ABA) was established to join the efforts of the banking sector.

In March, the association celebrates its twentieth anniversary. Over these years, the ABA has held successful activities aimed at supporting banking sector development. ABA President Eldar Ismayilov gave information on achievements and future plans in an interview with Trend .

Trend : The ABA prepares to celebrate its anniversary. What is the ABA's role in the positive trends observed in the Azerbaijani banking system?

Ismayilov: The association was established 20 years ago. Even then, commercial banks needed to jointly address many common challenges in the banking system. Over these years, the association has achieved several successes and setbacks, but overall it has successfully operated and grown.

Today, the ABA has three subsidiaries, the most advanced of which is the Azerbaijani Banking Training Center (ABTC), which is also celebrating its 10-year jubilee in 2010. The second structure is the Banks and Business magazine, which is also quite successful. The third is the Banking Information Technology Center, which provides general banking software products, but we still need to do a lot more in this direction.

The association has built a fairly stable relationship with the Central Bank of Azerbaijan and productively cooperates with the Tax Ministry. Of course, there are complex issues that have still not been addressed, but it is encouraging that the ministry has become more sensitive to the needs of banks in recent years. We still have a lot to do with the judiciary, which still has many unresolved issues.

In recent years, our banks have become fairly well integrated into the international financial and banking system. The ABA seeks to develop integration processes and make a modest contribution to our country becoming a regional financial center.

We have built and now successfully develop relations with international financial institutions and banking associations. In particular, we have signed contracts with 13 banking associations of foreign countries. It is very important because our economy is closely linked to these countries. We need to ensure that our banking systems were also closely linked and the banks can operate simultaneously and support cash flows with their activities.

We have entered into various international banking communities and participate in regional banking alliances. This is, first and foremost, the CIS International Banking Council and Eastern Europe and the European Banking Federation (EBF), of which we are associate members. Baku will host a regular annual EBF field meeting May 28 that will be attended by the presidents of banking associations of almost all theh European countries. This will certainly be a great event for Azerbaijan's banking community.

In 2008, the ABA initiated the establishment of the Coordination Council of Banking Associations of GUAM Countries. Together with the Azerbaijani Foreign Ministry, we held the international conference, "Integration of GUAM Countries' Banking Systems."

Q: What is the association's activity toward the establishment of the Central Eurasian Federation of Banks Associations? How many countries have acceded to the agreement?

A: Presently, the process of establishing this new regional bank union in underway. Theoretically, it will include the Banking Association of the Central Caucasus, Central Europe and Central Asia. To date, the federation includes the banking associations of Azerbaijan, Belarus, Georgia, Kyrgyzstan, Tajikistan, Turkey and Ukraine. These associations have already signed an agreement on the federation's establishment, whose headquarters will be located in Baku. The constituent documents of the federation are under review by the Justice Ministry and I hope these processes will be completed in 2010.

Q: What kind of problems is the banking banking sector facing and what must be done to solve them?

A: It is a broad question and I would, with your consent, limit my answer to those aspects that concern ABA's activity. Firstly, we support banks and non-bank credit organizations in order to coordinate various issues with the legal authorities.

Joint work is required in several directions, but the so-called problem loans have a priority.

Overcoming the difficulties in fulfillment of judgments is extremely urgent for banks in the country. I am sure that eventually we will be able to reestablish the judging attitude to the issues of mortgage and compensation of loans. Today, problems with the tax policy are also important.

The staff potential of Azerbaijani banks has already been formed, but we have to do much work to introduce international standards and this sharply increases the demand for management and executive staff. The process of improving professional skills of bank employees, including abroad, should be persistent and much more intense.

Q: The Central Bank said that only 15-20 banks operate on a satisfactory level? According to the upcoming CBA strategy on consolidation and optimization of the banking system, how many mergers can be expected?

A: Azerbaijan is in the process of building a new economy, which is optimizing everything and I am sure the system will "filter out" the banks. The main thing is banks to comply with the law. The process of the country's economic development will determine which banks and non-bank credit organizations will survive, and which will have to form mergers or simply close.

In 1994, over 230 commercial banks worked in Azerbaijan and now there are only 46 banks some of which were opened recently.

Perhaps, Azerbaijan doesn't need 15-20 system-forming banks but only three or four. there is no any universal method for determining their number. Clearly, however the economy can not be served by only system-forming banks. International practice shows that only 10-12 common, not system-forming banks fall to each system-forming bank. Therefore, the policy of the Azerbaijani Central Bank is based on the same benevolent attitude towards all the banks - both large and medium-sized and small.

Q: Is there any progress in the establishment of a single-payment system in the CIS?

A: A single-payment system, which is a step towards the restoration of the ruble zone, is actively discussed not only in the banking community but in certain political circles, especially in Russia.

Perhaps "the game is not worth the candle" if CIS states seek to recreate the ruble zone, but this desire doesn't exist. The dollar and the euro are stable in CIS countries and now the Chinese yuan and the Japanese yen are increasingly used in the area.

The Russian ruble is not strong enough a currency and is under the pressure of the U.S. dollar and the euro, which are deeply rooted in Russia's own currency and occupy a specific niche there.

Much is determined not by the wishes of politicians or banks, but by the state of the economic integration processes in the states and in particular the share of their mutual trade. For example, the CIS countries' trade turnover is only 15 percent of their total foreign trade turnover, while the remaining 85 percent come from export-import operations. In other words, most foreign mutual settlement of accounts is realized in U.S. dollars and euros and cardinal changes in this sphere are not expected in the foreseeable future.

The ABA was established by 10 private banks March 29, 1990 (Universal, Development Bank, East Bank, Togrulbank, Khazri, Azerdemiryol Bank, Deka-Bank, Azernegliyatbank, Azmanbank) and was registered as an Azerbaijani Association of Commercial and Cooperative Banks.

The association operates under its present name since 1999, and today all banks operating in the country are its members.

Do you have any feedback? Contact our journalist at [email protected]

Turkmengas opens tender for maintenance of gas turbine generators
Turkmengas opens tender for maintenance of gas turbine generators
The President of Turkmenistan receives representative of medical community of Germany
The President of Turkmenistan receives representative of medical community of Germany
Turkmenistan committed to promoting socio-economic development of Afghanistan
Turkmenistan committed to promoting socio-economic development of Afghanistan
Loading Bars
Latest
Geostat reveals volume of ferroalloys exported by Georgia to Turkey
Bahar Azadi gold coin price still falling in Iran
Kazakhstan continues introduction of mobile diagnostic tools in railway sector
Azerbaijan, Uzbekistan discuss possibilities of attracting investors to Azerbaijan territories liberated from occupation
Britain expects 'very significant' week for Brexit talks as clock ticks down
Iran declares cargo transportation from Sistan and Baluchestan Province
Death toll from COVID-19 tops 172,000 in Brazil
Chinese companies to process Uzbek garlic for further export to US and European countries
Turkey's export of grain, legumes to France declines
Iran reveals its COVID-19 data for November 29
Details of Iran’s trade turnover announced
EU aims to support Georgia in its efforts to reform electricity market
Azerbaijan confirms 4,170 new COVID-19 cases, 1,985 recoveries
5.5-magnitude quake hits Vanuatu
Azersu LLC announces tender for purchase of equipment for laboratory
Kazakhstan's import of Turkish cement up
Azerbaijan shows footage of Aghdam's Shahbuldag village (PHOTO/VIDEO)
Expenses on construction of enterprises in Iran’s Isfahan Province increases
Number of enterprises launched in Iran's Ilam Province shrinks
Turkmengas opens tender for maintenance of gas turbine generators
At least 30 police killed, over 20 wounded in suicide car bomb explosion in E. Afghanistan
Georgia reports 4 426 new coronavirus cases, 3 721 recoveries, 35 deaths
Over 5,500 patients recover from coronavirus in Moscow in the past day
Azerbaijan shows footage of liberated from occupation villages of Kalbajar region (PHOTO/VIDEO)
China increases import of Turkish cars
Employment in Iran's Alborz Province declines
The President of Turkmenistan receives representative of medical community of Germany
S. Korea reports 450 more COVID-19 cases, 33,824 in total
Azerbaijan's turnover on payment cards in 10M2020 up
Inter-Agency Coordination Council discusses enforcement of Covid restrictions
Azerbaijan has ample opportunities and potential for artificial intelligence dev't
Trump may announce plans for 2024 presidential race during Biden’s inauguration
826 more coronavirus cases recorded in Kazakhstan over 24 hours
France sees further fall in COVID-19 hospitalizations as lockdown exit starts
Turkey's Temsa makes 1st electric bus exports to Sweden
Iran registers monthly positive trade balance
Scottish dev’t agency eyes establishing co-op with companies in Uzbekistan’s Karakalpakstan
Croatian PM in self-quarantine after wife contracts COVID-19
UK records another 15,871 coronavirus cases with 479 deaths
Some 46,000 people gather in Paris to protest against security bill
Kazakhstan to modify large energy saving projects on railways
Severe fire danger for Australia as temperatures smash records
Dozens of Boko Haram militants killed in Nigeria airstrikes
Pope installs new cardinals, including first African-American
WHO reports new daily record high of over 747,000 COVID-19 cases
UK police arrest 155 in anti-lockdown protests in London
Assistant to Azerbaijani president posts footage from Tartar, Aghdam cities
UK, France sign new deal to stop illegal migration across Channel
Iran discloses electricity generation at Iran's Bandar Abbas TPP
Turkey reports 6,714 new COVID-19 cases, 487,912 in total
Zarif: Iran at forefront of fighting terrorism
Georgia takes necessary steps to avoid increase in bread prices
Ethiopian military has taken 'full control' of Tigray capital, government says
Iran’s Bahar Azadi gold coin price continues to fall
Weekly review of Azerbaijani precious metals market
Kazakhstan raises import of grain, legumes from Turkey
Buy/sell operations at Iran Mercantile Exchange revealed
AP publishes article covering Armenian missile attack on Azerbaijan’s Ganja on Oct.17 (PHOTO/VIDEO)
OIC adopts resolutions in connection with Armenia's aggression against Azerbaijan
President, members of Board of European Muslim Forum send letter to President Aliyev
Aghdam district of Azerbaijan after 27 years of Armenian occupation (VIDEO)
Kazakhstan to bring waste processing level to average European level
UK appoints minister in charge of COVID-19 vaccine rollout
Number of blocked malware in AzStateNet network drops
Airport in Uzbekistan to buy auto parts via tender
Iranian Energy Exchange announces products to be on sale November 29
Azerbaijani team takes third place in group exercises at 36th European Rhythmic Gymnastics Championships
At least 6 killed in Somali capital suicide bombing
Microsoft Azerbaijan to support all initiatives in liberated territories of Azerbaijan
Azerbaijan shows footage of Kalbajar's Vang village (VIDEO)
Police fire tear gas at Paris protest against police violence
Electricity imports growing in Georgia
Cargo, passenger traffic via Turkish Sabiha Gokcen Airport slumps amid pandemic
Uzbek-Korean JSC Uz-Dong Won Co. announces tender for steel pipes supply
Cargo transportation at Turkish Antalya airport reduces
Austria records nearly 1,000 COVID-19 deaths over past 10 days
State Employment Agency of Azerbaijan opens tender on supporting start-up projects
Results of Azerbaijan's junior national team performance at 36th European Rhythmic Gymnastics Championships announced
Details of Iran’s exports to Iraq declared
Azerbaijan reports 4,212 new COVID-19 cases, 1,760 recoveries
Four citizens dead as result of mine exploding in Fuzuli - Azerbaijani Prosecutor General's Office
Kazakhstan's export volumes to China surge despite COVID-19
Assistant to Azerbaijan's president, diplomats, Garabagh FC representatives visit Aghdam Mosque (PHOTO)
Turkmenistan committed to promoting socio-economic development of Afghanistan
Georgian oil companies seek to avoid price increases
Tender for maintenance of elevators, escalators launched in Turkey
Azerbaijan's ten-month output of oil products declines
Turkey's export of grain and legumes to Turkmenistan up
Turkmenistan, Belarus discuss program of cooperation
Iran reveals its COVID-19 data for November 28
Azerbaijani president's assistant, diplomatic corps reps arrive at liberated Aghdam city
Rural digitalization project successfully underway in Kazakhstan
Missile fired to Tartar by Armenia delivered to local museum - president's assistant (VIDEO)
Number of enterprises put into operation in Iran's Ardabil Province up
Water problems center to be created in Uzbekistan’s Khorezm region
Khazar Consortium opens tender for purchase of lubricating oil
Azerbaijan’s Baku Telephone Communications opens tender
Georgia sees increase in COVID-19 cases
Number of shells fired at Tartar district by Armenian Armed Forces revealed
German minister says partial lockdown could last until Spring 2021
All news