Azerbaijan's banking system remains attractive to foreign investors
Azerbaijan, Baku, Aug. 21 / Trend I.Khalilova /
The Central Bank of Azerbaijan (CBA) has noted the attractiveness of the banking system for non-residents.
According to the report on the financial stability of the Central Bank in the first half of this year, the deposits of non-resident individuals in Azerbaijani banks in January-June increased by 17.7 per cent (for the same period last year the figure was at 6.7 per cent), hitting 10 per cent of total deposits.
During the reporting period, the population's deposits in the banking system rose by 6.1 per cent to 4.372.6 billion manat, and their share of the banks' total liabilities as of late June was 34.8 per cent.
The Central Bank also noted positive changes in the structure of deposits on terms. Time deposits increased by 195 million manat, and demand deposits 57.6 million manat. The share of term deposits in total deposits as of late June was 79.4 per cent.
'As a result of increasing public confidence in the banking system, an increase was invested in the deposit portfolio, invested for the long term and in the national currency', the CBA report said.
In the first half, long term deposits increased by 8.4 per cent to 36.7 per cent of total deposits (in early 2012 the share was 35.9 per cent.) Deposits in the national currency in January to June rose by 8.7 per cent to 2.480.8 billion manat, to reach 56.7 per cent of total deposits (in the same period in 2011 - 48.5 per cent).
According to the report, the increase is observed in the structure of deposits of legal entities which last year increased by 9.7 per cent to 22.5 per cent of the banks' liabilities. During January-June, deposits in national currency in the country's banks decreased by 3.1 per cent and in foreign currency by 1.6 per cent. However, during the first half the funds raised from foreign banks and international financial institutions rose by one per cent, amounting to 1.873.9 billion manat.
'Those funds attracted from abroad were at an acceptable level and 14.9 per cent of the total liabilities of the banks', the report said.
The banks' liabilities in the first half rose by 6.1 per cent (727.3 million manat) to reach 12.555.6 billion manat as of late June. The total amount of deposits from January to July increased by 2.7 per cent to hit 9.704.3 billion manat, or 77.3 per cent of the banks' liabilities.
As of July 1 Azerbaijan numbered 44 banks.
The official exchange rate is 0.7854 AZN to $1 on Aug. 16.