Azernews.Az

By Sara Israfilbayova

The Financial Market Supervisory Body (FMSB) is studying the possibility of merging a number of local banks.

The possibility of capitalization of these banks is also being considered and the FMSB continues negotiations with bank shareholders to ensure the recovery and stability of the banking system.

The government has drawn up a plan for analyzing the financial situation in the country's banks, carried out diagnostic tests, and also assessed the quality of their assests, currency and capital positions, follows from the monitoring report on the implementation of measures reflected in the Strategic Roadmap for the Development of Financial Services.

"As a result of diagnostic tests for banks with capital insufficiency, a special program was prepared and appropriate instructions were given to eliminate the shortcomings," the report says.

The consolidation process of two Azerbaijani banks - Atabank and Caspian Development Bank has been completed in June and Caspian Development Bank was joined to Atabank.

Earlier, Head of the Association of Banks of Azerbaijan (ABA) Zakir Nuriyev stated that to make the process [reduction of number of the banks] painless, it is necessary to consolidate banks, rather than declaring them bankrupt.

He stressed that other banks have to follow the banks’ example, further adding that banks’ services are more important than their numbers.

Director of the Center for Economic and Social Development (CESD) Vugar Bayramov earlier said that the number of local banks, which is currently stands at 31, can be reduced to 20 in the near future.

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