Baku, Azerbaijan, Oct. 7
By Azad Hasanli - Trend:
In August 2016, the share of overdue loans in Azerbaijan reached 9.5 percent of the loan portfolio of the country’s banks, according to the report of the Central Bank of Azerbaijan.
The volume of overdue loans reached 1.6 billion manats, which is a 19.44 percent increase compared to August 2015, the report reads.
The official exchange rate is 1.6036 AZN/USD as of Oct. 7
The credit portfolio of the Azerbaijani banks increased by 0.76 percent and amounted to 16.8 billion manats in August 2016 compared to July 2016. The banks' lending in the economy declined by 16.2 percent compared to August 2015.
The banks issued over a half of loans worth 8.76 billion manats (nearly 52 percent) in the national currency, while the rest part – 8.08 billion manats (48 percent) in foreign currency.
This ratio was 73 and 27 percent in early 2015. But the share of foreign currency loans began increasing, reaching 49.3 percent as of the year after the February devaluation of the manat.
However, Azerbaijan's Financial Market Supervisory Body has established a moratorium on the issuance of consumer loans in foreign currency to the individuals who do not have foreign exchange earnings and bank deposits since April 2016 and imposed a ban on mortgage loans in foreign currency since May.
As a result, the share of manat loans began to grow gradually. For comparison, some 50.9 percent of the loan portfolio of banks accounted for the loans in national currency in March, 51.8 percent in April and 53.2 percent in May 2016.
As of Sept. 1, 2016, the volume of short-term loans amounted to 3.6 billion manats (including overdue loans worth 511 million manats) increasing by 1.1percent during the month, and the year on year decline amounted to 16.3 percent.
The volume of long term loans increased by 0.3 percent for the month and decreased by 16.3 percent to 13.2 billion manats for the year (including 1.08 billion manats of overdue loans).
According to the CBA, the credit portfolio of the state banks in the country amounted to 5.5 billion manats with the specific weight of 32.7 percent, while private banks issued loans worth around 10.8 billion manats with a specific weight of 64.2 percent, where 4.37 billion manats falls to the share of banks with foreign capital. The remaining 3 percent falls to the share of non-bank credit organizations, which issued 511 million manats.
The remaining 3.1 percent accounted for the share of non-bank credit organizations which issued 511 million manats, according to the CBA.
There are 37 banks in Azerbaijan, including two state-owned banks and 157 non-bank credit organizations, including 109 credit unions.