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Azerbaijan’s Financial Stability Board okays 200M manats bond issue

Business Materials 1 March 2017 20:13 (UTC +04:00)
Azerbaijan’s Financial Stability Board approved a 200-million manats guaranteed bond issue for 2017 by the Azerbaijan Mortgage Fund (AMF) OJSC
Azerbaijan’s Financial Stability Board okays 200M manats bond issue

Baku, Azerbaijan, March 1

By Azad Hasanli – Trend:

Azerbaijan’s Financial Stability Board approved a 200-million manats guaranteed bond issue for 2017 by the Azerbaijan Mortgage Fund (AMF) OJSC, said the international ratings agency Fitch Ratings.

The agency approved AMF’s Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at ‘BB+’.

Fitch expects AMF will continue to benefit from state support over the medium term.

“AMF has been receiving annual state contributions since its establishment. As of end-2016 the cumulative contributions totaled 316 million manats and the government has approved an additional 50 million manats equity injection in 2017,” according to Fitch.

Fitch projects AMF’s mortgage portfolio could grow 30-40 percent in 2017, supported by a 50-million manats injection and upcoming 200-million manats bond issue.

AMF will remain profitable over the medium term, according to Fitch.

However, Fitch estimates that the return on equity (net income/equity and reserves) ratio could moderately decline from 1.97 percent to 1.65 percent.

Fitch views AMF’s role as strategically important to the state’s housing policy.

“Demand for housing is fuelled by a growing population and the continued urbanization of the country,” said Fitch.

(1.7515 manats = $1 on March 1)

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