Azernews.Az

Qabil Ashirov

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A quiet but increasingly visible change is taking place in Azerbaijan’s financial market. For many years, the Baku Stock Exchange (BFB) has been a market dominated mainly by banks, large financial institutions, government securities and large-scale REPO transactions. The figures for 2026, however, point to another rapidly growing trend in the capital market: Azerbaijani citizens are showing increasing interest in stocks and corporate bonds.

In January-September 2026, the total turnover of transactions on the Baku Stock Exchange amounted to 33.53 billion manats. During the same period of 2025, this figure stood at 50.98 billion manats. The 17.45 billion manat decline in total turnover was mainly driven by lower activity in the REPO and government securities segments. The volume of REPO transactions fell from 40.3 billion manats to 26.19 billion manats, while turnover in government securities declined from 7.48 billion manats to 1.62 billion manats.

On the other side of these figures, however, a completely different picture is emerging.

The volume of stock transactions increased from just 14.3 million manats in the first nine months of 2025 to approximately 1.46 billion manats during the same period of 2026. This represents growth of more than 100 times. Significant activity has also been recorded in the secondary stock market.

This dynamic is an important signal for Azerbaijan’s capital market. The expansion of the stock market indicates growing investor interest in participating in companies’ capital. At present, shares of two companies are actively traded on the Azerbaijani market, with both companies representing the banking sector. Their dividend yields are also among the key factors attracting investors’ attention, with dividend payments reaching levels above 10%.

This situation is important for Azerbaijani citizens in terms of expanding investment alternatives to bank deposits. Investors seeking income are increasingly looking beyond deposit products and comparing dividend yields on stocks, potential price appreciation and coupon returns on bonds.

Another important segment of the capital market is corporate bonds.

In 2026, turnover in the secondary market for corporate securities reached approximately 1.7 billion manats. During the same period of 2025, the figure stood at around 196 million manats. As a result, the secondary market for corporate securities expanded by approximately 8.7 times.

This figure is one of the most interesting indicators of the scale of change taking place in Azerbaijan’s capital market.

Corporate bonds are becoming an increasingly attractive financial instrument for individual investors. A number of corporate bonds offered on the Azerbaijani market carry annual coupon rates of around 15-16%. In many issuances, coupon payments are made monthly, allowing investors to manage their cash flows more conveniently.

For example, a 16% bond investment of 100,000 manats generates 16,000 manats in annual coupon income. If monthly payments are applied, this corresponds to an average monthly coupon income of approximately 1,333 manats. Such calculations make bonds more attractive as part of citizens’ investment portfolios.

Another important change is also taking place here. Previously, the secondary market for corporate bonds was relatively weak. Investors would buy bonds, hold them until maturity and wait for their coupon income. The figures for 2026 show that trading of bonds between investors is accelerating. The increase in secondary-market turnover from 196 million manats to 1.7 billion manats is a significant indicator of improving liquidity in the capital market.

This process also creates new opportunities for part of the funds held by the population in the banking system to be directed toward the capital market. For Azerbaijani citizens, the concept of investment is gradually moving beyond a framework limited to deposits, real estate and foreign currency to include financial instruments such as stocks and bonds.

There is also greater potential for the future of the stock market. Market participants are circulating unofficial information that companies operating in various non-bank sectors of Azerbaijan could conduct initial public offerings, or IPOs. This information currently does not have the status of confirmed official information, and expectations regarding specific companies have yet to be clarified. However, the emergence of new IPOs could significantly increase the depth of the stock market.

At this stage, the key issue is the sustainable growth of the number of investors and investment culture. In the first nine months of 2026, the number of transactions on the Baku Stock Exchange increased from 22,588 to 48,570. This represents growth of 115%. While overall turnover declined, the number of transactions more than doubled, indicating that a larger number of transactions were being carried out in the market.

The new stage of Azerbaijan’s capital market is characterized precisely by these figures: 1.46 billion manats in stock turnover, 1.7 billion manats in the secondary market for corporate securities, 15-16% bond coupon rates, dividend yields above 10% and 48,570 transactions.

The Baku Stock Exchange is thus gradually evolving from a platform where mainly large financial institutions operate into a market where Azerbaijani citizens are also increasingly turning their savings into investments. As this process continues, the number of stocks, corporate bonds and future IPOs will increase, investor choice will expand, and the role of the capital market in the economy will grow further.