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BSTDB holds first meeting chaired by new president

Business Materials 22 July 2010 16:10 (UTC +04:00)

Azerbaijan, Baku, July 22 / Trend I. Khalilova /

The 77-th meeting of the Board of Directors of the Black Sea Trade and Development Bank (BSTDB) will be held July 23-24 in Thessaloniki (Greece). It will be first held under the chairmanship of the bank president Andrei Kondakov who took office July 16.

Minister of Economic Development Shahin Mustafayev is a manager of the bank from Azerbaijan, his deputy - Minister of Finance Samir Sharifov.

Azerbaijan belongs to a group of small shareholders. BSTDB's lending increased than the total portfolio, in particular in 2007-2008, former bank president Hayrettin Kaplan said in an interview with Trend.

Azerbaijan ranks six in the loan portfolio of the bank given 13 signed contracts for transactions totaling more than $ 80 million. BSTDB's portfolio on Azerbaijan amounted to only about $ 30 million in late 2006.

"There is no direct relationship between the proportion of countries in the bank's capital and funding operations, which is estimated from the perspective of risk in our bank. At the same time Azerbaijani increased share in the capital of the bank increased its voting rights on decisions taken by the bank," Kaplan said.

The bank approved two projects in Azerbaijan - in the chemical industry and construction sector in 2010.

The current strategy of the bank in Azerbaijan, which covers 2006-2010, provides support for the production and development of micro, small and medium-sized enterprises, trade finance, in particular, the import of capital goods, industrial equipment, infrastructure, telecommunications, transport, agriculture.

The next strategy for the country for 2011-2014, will be developed in accordance with the bank's medium-term strategy and business plan, which is under preparation, Kaplan said. The bank will define its operational priorities in Azerbaijan jointly with the government and other stakeholders, as well as in accordance with the Memorandum of Understanding between Azerbaijan Investment Company and BSTDB concentrated on investments in non-oil sector after the Board of Governors approves the bank medium-term strategy.

BSTDB new president said that in the coming years, the bank expects to further strengthen the bank's position in the region, its more active turn in the direction of lending of the public sector and municipal infrastructure projects and energy, particularly renewable, environmental protection, through new energy-saving technologies, etc.

"We want to increase an equity participation of our partners. We will vigorously work towards further improvement of BSTDB's credit rating, strengthen our program of borrowing in foreign financial markets.

Finally, we intend to develop closer cooperation with leading international financial institutions, through co-financing of new regional projects ", Kondakov said.

As a result of the global crisis, the bank revised the medium-term strategy and business plan, re-directing them, mostly, not so much to build the loan portfolio (in 2006-2008 it is already doubled), but rather to maintain its quality, strengthen control over the implementation of the signed loan agreements.

"These measures fully justified themselves. The last two years we have completed with a good net profit, while many other international financial institutions have recorded losses. We also managed to avoid new problem loans. A vivid testimony to the stable position of the bank is that BSTDB is in crisis and retained its credit rating (Baa1 by Moody's) amid downgrades of several countries - the major shareholders", Kondakov said.

Turkey has the largest portfolio of projects in the bank. Earlier, it was Russia during several years, and before it - Ukraine. It should be noted that there is no direct correlation between the shares of the bank and the volume of funded projects within these programs.

The combined share of the bank's capital of many small shareholders (Azerbaijan, Albania, Armenia, Georgia, Moldova) was 9,5 percent, while the share in the loan portfolio amounts to 19,7 percent.

The Black Sea Trade and Development Bank has been working since June 1, 1999.

Today, Greece, Russia and Turkey remain the largest shareholders with stakes of 16.5 percent each, Romania owns 14 percent, Bulgaria and Ukraine - by 13.5 percent each, Azerbaijan - 5 percent, Albania - 2 percent, Armenia and Moldova - one percent each, and Georgia - 0,5 percent.

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