CBA holds a quarter of its foreign reserves in securities
By Aynur Jafarova
The Central Bank of Azerbaijan (CBA) placed $3.34 billion in securities in the first nine months of 2013.
According to the bank's statistical report released on October 29, the mentioned figure accounts for 25.46 percent of the bank's total reserve assets in foreign currency.
In the same period in 2012, about $3.98 billion of the bank's total foreign exchange reserves were placed in securities.
The bank reports that some $9.06 billion are in the accounts of two other central banks, the Bank for International Settlements and the International Monetary Fund.
Their volume increased by 32.97 percent compared to the same period in 2012, while the specific weight of the total assets held by the Central Bank reached 69.03 percent.
The central bank's total reserve assets in foreign currency amounted to $13.13 billion in the first nine months of 2013, which shows a 15.66 percent increase compared to the same period in 2012.
As of late September, the bank's reserves kept in foreign currencies amounted to $12.89 billion, which shows a 16.03 percent ($11.1 billion) increase compared to the same period in 2012.
The total currency reserves of the bank exceeded $13.2 billion as of October 1.
Since early 2013, the currency reserves of the bank have increased by 13.4 percent or $1.568 billion.
The currency reserves stood at over $11.694 billion at the beginning of 2013.
The bank is studying new management instruments for its currency reserves.
According to Deputy Chairman Khagani Abdullayev, the bank is not considering any drastic, profitable options of placement, and resorts to instruments with stable rating.
"Currently, our strategy includes several items on the diversification of instruments. We don't expect any radical displacements in the portfolio. However, we are considering new instruments for developing markets. Principally, they are long-term securities and deposits," Abdullayev said.
Rapid growth of the currency reserves was the main factor for the formation of a strong macroeconomic buffer and the reduction of the sensitivity of the domestic economy against external shocks.
The increase in reserves led to maintaining the continued net investment position of the country at an acceptable level.
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