Baku, Azerbaijan, Jan. 9
By Emin Aliyev - Trend:
Starting from February 1, 2014, Azerbaijan will for the first time, introduce a classification for consumer loans.
A decision by the Central Bank of Azerbaijan (CBA) to approve rules for classification of banking assets and creation of special reserves to cover possible damage to them, has been published in the Azerbaijani Justice Ministry's normative legal acts registry.
The already existing regulations do not include classification of consumer loans. According to the new rules, consumer loans include those for payment of current expenses, household needs, car loans and credit cards.
Loans with the main parts and interest being repaid in line with the loan agreement or a delay up to 30 days, will be classified as satisfactory assets. Loans with a delay from 31 to 60 days will be referred to controlled assets, with a delay term from 61 to 90 days - unsatisfactory, from 91 to 120 days - dangerous, and in case of delay of over 120 days - bad assets.
In case of absence of documents allowing examination of the borrower's financial position or in case of delay in payments for more than six months, the loan issued to the borrower is classified no less than as being a 'controlled' asset.
Consumer loans amounting to more than 70,000 manats and lacking any documents proving the loan's appropriate disbursement, are classified in a similar way.
The official exchange rate on Jan. 9 is 0.7844 AZN/USD.
Translated by E.A.
Edited by S.M.