By Nigar Abbasova
Azerbaijan’s Financial Market Supervisory Body (FMSB), which oversees the domestic financial market, has withdrawn licenses of some 12 credit unions.
The regulator made the decision after revealing certain violations of the regulatory accountability, as well as due to a lack of a third-party audit reports for 2015.
Under the decision, licenses of Arzu, Azeri Invest, Janub, Compass, F.A.S., Hakari, Kredo-Invest, Real, Tarakama, Tural and Yardımlı NBCOs have been abolished.
The NBCOs must suspend their activities from the effective date of the relevant decision, in accordance with the law, while debts are payable even after a closure of these financial organizations.
Under the law, NBCOs should maintain accounting and submit annual financial statements approved by an external auditor no later than 5 months after the end of a fiscal year and publish the statements in mass media. Borrowers, as well as other stakeholders, have a right to get acquainted with the latest financial statements of institutions.
Starting from 2015, a vulnerability of Azerbaijan's financial system to risks increased due to external economic shocks. The market of non-banking organizations (NBCOs) stood among those most affected by recent economic shocks.
NBCOs provide certain types of banking services, but do not hold a banking license and are not eligible to accept deposits from the public.
FMSB covers all aspects of regulation of financial and banking activities based on the best international principles. The institution is in charge of licensing, regulating and controlling activities of securities market, investment funds, insurance and credit institutions (banks, non-bank credit institutions, postal operator) and payment systems.
Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova
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