Baku, Azerbaijan, Nov. 22
By Azad Hasanli – Trend:
Fitch Ratings has upgraded Open Joint-Stock Company International Bank of Azerbaijan's (IBA) Long-Term Issuer-Default Rating to 'B-' from 'RD' (Restricted Default). The agency has also upgraded IBA's Viability Rating (VR) to 'ccc' from 'f'.
The upgrades of the bank's ratings follow the completion of IBA's debt restructuring on 1 September 2017 and the latest transfer of bad assets off the bank's balance sheet, which Fitch expects to be completed shortly.
IBA's asset quality has significantly improved during the last 12 months due to the further transfers of bad assets. According to regulatory accounts, the bank's net loan book has contracted to AZN1.8 billion at end-9M17 (24 percent of total assets), of which around AZN300 million is to be transferred in 4Q17.
International Bank of Azerbaijan OJSC has been recovered since July 2015, which is related to preparations for privatizing the state-owned shares of the bank. In order to restore the bank’s financial position, its distressed assets were transferred to Aqrarkredit CJSC, a state-owned non-bank credit organization. Aqrarkredit CJSC provides the IBA with liquid assets in exchange for distressed assets.
The International Bank of Azerbaijan has been operating since 1992. More than 90 percent of the bank’s shares belong to the Azerbaijani state.