Baku, Azerbaijan, Oct. 12
By Azad Hasanli – Trend:
In January-August 2017, the volume of refinancing by the Central Bank of Azerbaijan (CBA) amounted to 977.8 million manats, the CBA report said.
The refinancing rate in Azerbaijan has been 15 percent since September 2016. Refinancing in the reporting period decreased 6.6 times compared to January-August 2016, when this figure was 6.5 billion manats (at a refinancing rate of 9.5 percent).
Refinancing involves issuance of loans by the CBA to commercial banks. Such measure is often applied if banks have exhausted their resources and are unable to replenish them from other sources.
Nevertheless, the CBA significantly increased the use of another tool for managing liquidity in the banking market - notes. In January-August, the volume of notes issued by the CBA reached almost 1.75 billion manats. The CBA started issuing notes only in November 2016 and issued notes worth 221.8 million manats for the rest of last year.
The volumes of notes’ issuance have been growing from month to month. So, if in early 2017, their monthly volume varied within 40-90 million manats, in June this figure amounted to 350 million manats, in July - 450 million manats, and in August - 550 million manats.
At the same time, the interest rate on notes has been gradually decreasing. At the beginning of the year, the average interest rate on notes was 12.98 percent, and by August it decreased to 10.01 percent.
There are 31 banks, including two state-owned ones, in Azerbaijan.
(1.7003 AZN = $1 on Oct. 12)