Baku, Azerbaijan, Oct. 22
By Azad Hasanli – Trend:
In 2017, Azerbaijan Railways CJSC signed a number of agreements on restructuring and consolidation of credit debt, according to the company’s financial statement.
On April 28, the company signed an agreement with the International Bank of Azerbaijan (IBA) on consolidation of all dollar loans taken before December 31, 2016, into one loan.
In 2014-2015, the IBA issued seven loans for capital expenditure and financing of the Baku-Tbilisi-Kars railway project to Azerbaijan Railways. According to the financial statement, only four of these loans in the amount of 99.89 million were denominated in dollars.
It is expected that payment of principal debt will commence in three years from the date of restructuring, that is, from April 2017. In addition, Azerbaijan Railways and the IBA signed a loan agreement worth 200 million euros with an annual interest rate of 1.25 percent.
Another agreement on consolidation of loans was signed in April with Azerbaijan’s second state bank - Azer Turk Bank. The debt to this bank is $3 million. The agreement provides for the refinancing of this credit debt and its consolidation with debt to the IBA.
In July, the company also signed a deal with Kapital Bank. The agreement provides for the consolidation of all dollar loans (three loans worth $160 million), taken from the bank before December 31, 2016, into one loan. Under the terms of the contract, the repayment of the principal debt will start two years after the date of its restructuring.
Since early 2017, Azerbaijan Railways signed similar agreements with two foreign banks. Two such agreements were signed in February and July with the Austrian subsidiary of VTB Bank, and they concern the loan worth $195 million. Under the agreements, Azerbaijani Railways will pay $1 million instead of $3.6 million per month, and will make a payment of $25 million in February 2019 to pay off credit debt.
Another agreement, signed in July with the Swiss subsidiary of BNP Paribas, provides for reduction of monthly payments on credit debt from $2.6 million to $1 million. The payments will begin in July 2018 and in February 2019, Azerbaijan Railways will pay $35 million to the bank. The agreement concerns the loan in the amount of $180 million taken from the bank in 2015.
As of late 2016, the total loan debt of Azerbaijan Railways amounted to 1.83 billion manats, including long-term debt of 1.35 billion manats.