New banking agency passes state registration
By Aynur Karimova
The Agency on Management of Bank Assets has passed state registration in Azerbaijan, "Vergiler" newspaper of the Taxes Ministry reported on September 2.
Suleyman Bakirov is the official representative of the new agency.
The authorized capital of the agency is 10,000 manats ($9,543).
Currently, there are 42 banks in Azerbaijan. Earlier, Azerbaijan had 44 commercial banks. The Central Bank of Azerbaijan closed two of them in July. Many experts point out that the number of banks in Azerbaijan does not correspond to the size of the economy, naming the optimum number to be 20-25 banks.
The CBA set higher capital requirements for banks bringing the capital floor up to 50 million manats ($47.71 million) in 2014 to force bank consolidation and reduce risks. Larger banks meant larger loans to support the development of the economy.
Recently, Standard & Poor's Ratings Services has estimated the trend of intensifying economic risks in the banking sector of Azerbaijan as "stable" and expects that the banking structure, as a whole, to remain unchanged.
Azerbaijani banks had limited risks from foreign currency lending before 2015. This was due to the CBA maintaining a fixed exchange rate for the manat against the U.S. dollar.
The official exchange rate on September 1 was 1.0479 AZN/USD.
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Aynur Karimova is AzerNews’ staff journalist, follow her on Twitter: @Aynur_Karimova
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