Baku, Azerbaijan, August 5
By Ilaha Mammadli - Trend:
Azerbaijani banks increased the volume of consumer lending by 31 percent in January-June, 2014 compared to the same period last year.
The share of consumer loans in total share of the loan investments by the banks amounted to 40.7 percent, or 6819.9 million AZN, according to the report of the Central Bank of Azerbaijan (CBA) on the results of the first half of 2014. For comparison: their share accounted for 37.7 percent, and the amount of loans - 5,199 million AZN in January-June last year.
The rate of consumer lending decreased in the country after the introduction of restrictions by the regulator. If new loans in the amount of 882.3 million AZN were issued within the first six months of 2013, it was 605.2 million AZN in January-June.
The CBA urged the country's banks to tighten control over consumer loan issuance in late 2013. The regulator sent a letter to the banks operating in the country with the instructions to stop issuing the loans if the borrower does not submit an employment certificate. The lending conditions for car purchases were also tightened, which in the experts` opinion is associated with the deterioration of the portfolio quality of the banking sector for this type of lending.
The second highest proportion in the total loan portfolio of banks is the trade and services sphere (14.5 percent, or 2429 million AZN), increasing by 12.3 percent. The third place is taken by the construction and real estate sector (13.6 percent or 2283.1 AZN) the lending of which increased by 25.35 percent.
The industry and production sector received 11.7 percent from the total volume of lending to the real sector of Azerbaijan, which in nominal terms amounts to 1965.8 million AZN. Lending to this sector increased by 46.5 per cent.
In connection with the announcement of 2014 the Year of the industry, the banks also increased lending to this sector. For comparison: in January-June 2013 the share of lending to the industrial sector accounted for 9.7 percent out of total bank deposits in the country's economy.
The share of transport and communication accounts for 3.5 percent (586.8 million AZN), agriculture and processing - 4.5 percent (762.1 million AZN), energy, chemistry, and natural resources - 1.3 percent (225.4 million AZN) and lending to other areas - 10.2 percent, or 1709 million AZN.
There are 44 banks operate in Azerbaijan, As of July 1, banks issued loans in the amount of about 16.755 million AZN, which is 21.64 percent more than the same period last year.
The official exchange rate is on August 5 is 0.7843 AZN / USD.
Edited by CN