Baku, Azerbaijan, July 15
President of Azerbaijan Ilham Aliyev has signed a decree on the measures for rehabilitation related to the preparations for privatizing the state-owned shares of the International Bank of Azerbaijan JSC.
The decree said that in order to maintain the bank's financial stability, uninterrupted fulfillment of the obligations, in particular, eliminating the negative impact of the 2008-2009 global financial crisis on the bank's financial position, the relevant state bodies rendered constant support to the bank.
Moreover, for the mentioned purposes, the bank's liquidity and capital were maintained at the required level and the bank remained as a reliable partner for local and foreign creditors, according to the decree.
Nevertheless, the shortcomings in the management, investment and loan policy of the International Bank of Azerbaijan in recent years, as well as financing of less efficient, risky investment projects worsened the bank's financial state, caused increase in the share of distressed assets and reduced its liquidity, said the decree.
"In order to overcome the current situation, restore the bank's financial position and ensure its sustainability, there is a need to transfer the bank's distressed assets to a specialized structure," said the decree.
Thus, the Ministry of Finance and the Central Bank of Azerbaijan should determine the share of the distressed assets of the International Bank of Azerbaijan within 15 days.
They should remove these assets from the bank's balance sheet in exchange for liquid funds in stages, and transfer them to the state-owned Aqrarkredit CJSC non-banking credit organization.