Azerbaijan, Baku, Aug.30 / Trend, N. Ismayilova /
The Moody's international rating agency expects an increased growth rate on the Azerbaijani banking sector in both the medium and long term, the company said in a report released today.
"Total assets and loans in the Azerbaijani banking system amounted to 33 percent and 24 percent of the GDP as of late 2009," the report stated.
According to Moody's, there is significant potential for further growth on the Azerbaijani banking sector. Azerbaijani banks mainly concentrate their activities inside the country, the report said. Last year, 95 percent of all bank loans were issued in Baku and the surrounding regions.
Moody's expects that the "growth rate of the Azerbaijani banking sector will outrun GDP growth in the medium and long term," the reported added.
In 2009, bank deposits amounted to 13 percent of the GDP. Some 60 percent of loans in Azerbaijan were funded by customer deposits. Moody's believes that the long-term potential to attract domestic funds is high. In late 2009, the amount of deposits by physical entities in banks also increased, outrunning the growth of corporate client deposits. This development is also supported by a low inflationary environment.