Azerbaijan's banking sector remains attractive to foreign investors
The Central Bank of Azerbaijan (CBA) has noted the attractiveness of the banking system for non-resident investors.
According to the CBA financial stability report for the first half of 2012, the deposits of non-resident individuals in Azerbaijani banks increased by 17.7 percent compared to 6.7 percent last year, and made up 10 percent of total deposits.
The population's deposits on banks rose by 6.1 percent to 4.4 billion manat, holding a 34.8 percent in share of the banks' total liabilities.
The Central Bank also noted positive changes in the structure of deposits on terms. Time deposits increased by 195 million manat and demand deposits by 57.6 million manat. The share of term deposits constituted 79.4 percent of total deposits as of late June.
"Increase in public confidence in the banking system resulted in increase in the deposit portfolio..." the CBA report said.
In January to June of 2012, long-term deposits increased by 8.4 percent to 36.7 percent of total deposits compared to 35.9 percent fixed in the beginning of 2012. Deposits in the national currency rose by 8.7 percent to 2.5 billion manat, making up 56.7 percent of total deposits. The figure was 48.5 percent in the same period of 2011.
According to the report, the increase was also observed in the structure of deposits of legal entities, which increased by 9.7 percent over the past year to 22.5 percent of the banks' liabilities. Deposits in national currency in the country's banks decreased by 3.1 percent and in foreign currency by 1.6 percent. At the same time, the funds raised from foreign banks and international financial institutions rose by one per cent to 1.9 billion manat.
"The funds attracted from abroad made up 14.9 percent of the total liabilities of the banks, which quiet acceptable," the report said.
The banks' liabilities in the first half rose by 6.1 per cent (727.3 million manat) to reach 12.555.6 billion manat as of late June.
The total amount of deposits increased by 2.7 percent from January to July to 9.704.3 billion manat, or 77.3 per cent of the banks' liabilities.
Azerbaijan has 44 banks as of July 1.
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