Azernews.Az

BAKU – The International Bank of Azerbaijan (IBA), the country’s leading bank, held a meeting of its shareholders on July 20 to discuss key issues spanning from the bank’s financial standing to revenues and dividends.

According to the IBA press-service, the meeting, presided by Finance Minister Samir Sharifov, passed decisions on three main issues – approval of IBA’s 2009 financial reports, submitted by an independent auditor and recommended by IBA’s Audit Committee; profits made in 2009 and policy on dividends; and the composition of the Committee.

The financial reports were approved at the general shareholder meeting.

Last year’s net profit of the bank made up 128 million manats ($160 million). In the first and second quarters of 2009 IBA spent 46.7m manats ($58.3m) to pay out dividends. In Q3, designated contributions from IBA’s profits worth 40m manats ($50m) were channeled into the bank’s capital stock according to the shareholders’ decision. Further, in Q4 2009 and in Q1 and Q2 2010, IBA posted hefty profits.

According to Azerbaijan’s legislation, their distribution and dividend payouts were decided by the shareholders. 66% of the stockholders who hold a total of 80% of the bank’s stock, including the Ministry of Finance, voted for paying dividends as of the end of the year, instead of the previous quarterly payouts, and also decided on dividend payouts in 2011. 34% of the shareholders present voted against the decision.

Further, the make-up of the IBA Audit Committee was reduced to five members, according to a decision passed on the proposal of the Ministry of Finance, which owns the controlling stock. The decision comes after their number was raised from three to seven at an extraordinary shareholder meeting in October 2009. That decision was based on the need for tightening control over management amid surging assets, expansion in IBA’s activity and expanding network of IBA subsidiaries and representations.

IBA is currently the most capitalized bank in Azerbaijan, with capital stock amounting to 240m manats ($300m). As of July 1, the bank’s capital reported on its balance sheet stood at 627.7m manats ($784.6m). In the first half of 2010 alone, IBA transferred taxes to the tune of 22m manats ($27.5m) to the state budget. IBA’s income in January-June exceeded 189m manats ($236m). The bank’s pre-tax profit was at the level of 41.4m manats ($51.7m), while its net profit stood at 31.5m manats ($39.3m).

IBA holds top international ratings in Azerbaijan from Fitch (BBB-) and Moody’s (Baa3).

IBA was established in 1992 as a successor of the Azerbaijan branch of the Foreign Economy Bank. IBA has a well-developed branch network and provides banking services to large corporate clients and, to a lesser extent, to individuals.

IBA is the only Azerbaijani bank with state participation. The state-owned share in the bank is 50.2 percent, while the rest of the capital is held by private shareholders.