Baku, Azerbaijan, July 11
By Anvar Mammadov – Trend:
Azerbaijan’s banking sector is able to continue active lending to the country’s economy, Zakir Nuriyev, head of the Azerbaijan Banks Association (ABA), said in an interview with Trend.
He said that despite the decline in activity, banks continue to lend to both economy and individuals, as well as legal entities.
“If one looks at the figures for the last six months of 2017, one can see that the activity of banks’ lending to the economy has slightly decreased, but the banks continue this process,” Nuriyev said. “The volume of loans issued by the banking sector in January-June 2017 amounted to 2.2 billion manats. This shows that banks continue lending to the economy, individuals and legal entities, but the volume of demand on the part of economy doesn’t grow. The decrease in the volume of external debt and funds raised by banks abroad also shows that the demand on the part of the economy and population itself decreased.”
He added that the main reason for the decline in lending is the reduction in demand on the part of the economy.
“To date, funds on correspondent accounts of Azerbaijan’s banks amount to 1.5 billion manats, and about 700 million manats of them are placed in the notes of the country’s Central Bank and government bonds of Azerbaijan’s Finance Ministry,” he noted. “If one looks at foreign currency correspondent accounts, the funds on them amount to over 4.5 billion in manat equivalent.”
“This shows that Azerbaijan’s banking sector has a sufficient number of liquid assets,” he said. “However, due to low throughput and insufficient activity of the transmission mechanism of the economy, the country’s banking sector isn’t able to allocate loans to the economy in the planned volumes.”