(Added details, the first version was published at 15:27)
Azerbaijan, Baku, Aug.3 /Trend I.Khalilova/
The minimum total capital of existing banks, as well as the authorized capital of newly established banks increased to 50 million manat by the decision of the Central Bank of Azerbaijan (CBA), CBA told Trend on Friday.
The decision of the Central Bank is adopted on July 25, 2012.
The new standard for the minimum total capital will come into force from January 2014. At present, the minimum capitalization requirement, both for existing and newly created banks is 10 million manat.
"The transition period provides enough time for banks to implement strategies to meet the new requirements for capital and for the gradual implementation of the capitalization," the statement said. "Studies have shown great potential in the banking sector to meet the new requirement."
Application of the new requirements will promote increase of equity and efficiency of financial intermediation in addition to strengthening the position of the Azerbaijani capital of banks, which will result in an even more enhanced stability of the banking system and financial stability.
"At present, Azerbaijan's banking system is entering a new stage of development. It is necessary to continue the capitalization to enhance financial intermediation, integration into global financial markets and provide new quality of banking services at this stage," the statement said. "Strengthening of the capital base of banks is of great importance in terms of improving confidence in banks and their international competitiveness."
At the same time, it will have a positive impact on the development of financial markets, in particular the interbank market, the expansion of economic subject's access to financial services, the improvement of the range of banking services and support the cheapening of their value.
"All this will increase the financial depth of the banking system adequately to aims to double the growth and diversify of the economy," the CBA stated.
Official exchange rate on Aug. 3 is 0.7855 AZN/USD