Baku, Azerbaijan, Sept. 7
By Ilkin Shafiyev - Trend:
Large-scale policy on restructuring and improving banking sector should be implemented in Azerbaijan, Elman Rustamov, chairman of the Central Bank of Azerbaijan (CBA), who is also a member of the Financial Stability Board, said at the Azerbaijan Competitiveness Forum Sept. 7.
He said that this will contribute to maintaining financial stability in the country.
“Considering that Azerbaijan’s financial sector relies mainly on banks, maintaining stability in the banking sector is very important,” Rustamov said. “This policy should be aimed at addressing the problems associated with debt on loans and capitalization.”
He also noted that there are opportunities for the development of stock market in Azerbaijan, in particular, for the expansion of the issuance of government securities.
“Formation of an effective financial market is an important task,” Rustamov added. “It is necessary to increase the confidence in the financial sector and create necessary infrastructure for development of the securities market. Another direction is the expansion of the securities market. In particular, it is important to significantly increase the volume of issuance of government securities. Also, international credit organizations positively assess the initiatives of issuing securities in Azerbaijani manats.”
The European Bank for Reconstruction and Development, as well as the Black Sea Trade and Development Bank are showing interest in the issuance of bonds in Azerbaijani manats.
Thirty banks operate in Azerbaijan. As of June 2018, capitalization of Azerbaijan’s banking sector amounted to 3.9 billion manats, having increased by 5.25 percent since the beginning of the year, according to the Azerbaijan Financial Market Supervisory Authority (FIMSA).
Compared with the previous month, capitalization slightly decreased in June - by 0.64 percent.
As of August 1, 2018, Azerbaijan’s credit institutions increased lending by 3.5 percent compared to the beginning of the year, to 12,170.7 million manats, according to the report of the Central Bank of Azerbaijan (CBA).
The value of overdue loans grew 9.55 percent since the beginning of the year, to 1,782.1 million manats, according to the report. At the same time, the share of overdue loans increased from 13.8 percent to 14.64 percent during the same period.
(1.7 manats = 1 USD on Sept. 7)
---
Follow the author on Twitter: @IlkinShafiyev