Consolidation as one of development priorities for Azerbaijani banking sector in medium term prospect
Azerbaijan, Baku, Oct. 29 / Trend N. Ismayilova /
The priority in the development of the Azerbaijani banking sector in 2012-2015 is to implement measures to increase the capitalization and continue the process of the banks' consolidation, the draft concept of socio-economic development for 2012 and the next three years, submitted to the Azerbaijani Parliament said.
There is a successful practice of the banks' consolidation with the European Bank for Reconstruction and Development in the country's banking system. UniBank was formed by two commercial banks' merger - MBank and Promtexbank in 2002. The EBRD bought a 15 percent stake. Bank of Baku merged with IlkBank in 2005.
The Azerbaijani Central Bank stated about the intensification of the process of the banks' consolidation in 2010. These measures were put on the basis of the key directions of the policy of monetary and financial stability for 2011.
Though banks, which do not meet the minimum requirements for the CBA capitalization, have little market share, the central bank included the issue of banks' merger in the agenda.
The priorities of developing the national banking system in the medium term prospect are to complete the corporate structure and to improve governance in banks, to expand opportunities for access to banking services, to strengthen and improve the payment systems and to expand financial instruments.
One of the priorities is to promote new mechanisms and institutions of reaching the financial resources in accordance with the demand for the capitalization in the economy, and in particular the acceleration of this process in the regions. This includes the expansion of mortgage lending, microfinance network and non-bank credit institutions.
According to the Azerbaijani Central Bank, the banks' assets amounted to 13.302.8 billion manat, total capital - 2.036.1 billion manat as of September 1, 2011. About 44 banks operate in Azerbaijan.
The official exchange rate is 0.7869 manat to $1.