Banking sector lacks problems with manat liquidity
By Nigar Abbasova
Azerbaijan’s banking sector, which was seriously affected by certain unfavorable processes, currently faces no liquidity problem with the national currency, the manat.
Chairman of Azerbaijan Banks Association Zakir Nuriyev said that the banks operating in the country lack the manat liquidity problems.
As for the foreign currency shortage and refusal of banks to sell the dollar to the population, the chairman said that the restriction is connected to the fact that banks are able to sell the currency should they receive it at currency auctions or from clients engaged in export operations.
He mentioned that the Financial Market Supervisory Body has already strengthened control over the banking sphere, mentioning that the problems with the shortage of financial means were solved in a number of banks.
The supervision carried out by the FMSB envisages stress tests and analysis of the situation for taking measures aimed at preventing problems.
Nuriyev said that the problem in the banking sector appeared due to the fact that the financial institutions were not able to manage the loans.
He voiced hope that the financial institutions operating in the country will be able to improve their operation and the country will not witness the process of closure of other banks.
However, he noted that the process is usual all over the world.
The licenses of 10 banks were revoked in 2016 due to their failure to meet necessary requirements specified in the relevant legislation.
The assets of banks were not classified in line with the law, they didn’t create adequate reserves and the aggregate capital of these banks didn’t meet the minimum requirements which stand at 50 million manats ($31.8 million).
Some 32 banks are currently operating in the country.
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Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova
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