Financial Companies Face Hidden Processes

Baku Stock Exchange (BSE) opened data on OTC turnover of corporate securities for December 2015.

According to the report, the purchase and sale of securities of financial companies during this period amounted to 625 million 584.2 thousand manats. The subject of trades became 500,537,815 shares of various denominations.

In one of the investment companies in an interview with Turan they expressed the assumption that 500 million shares with a total nominal value of 0.5 billion manats are of state bonds of CJSC Non-bank Credit Organization Aqrarkredit. The bonds were issued for the recovery of bad assets of the International Bank of Azerbaijan. Securities, as well as the last time in September, were bought by the Central Bank. Total from September to December the Central Bank bought bonds of Aqrarkredit totaling 1.5 billion manats.

Note that none of these structures provides official information on these transactions. On the corporate website of Aqrarkredit there is also no information that it had received assets from the IBA.

It is noteworthy that in December 537,815 shares of unknown financial companies were traded, totaling 125.5 million manats. As the analysis of the data from previous years shows, it is the largest volume of OTC transactions on secondary trading of financial companies of the Central Bank for the entire period of operation of the stock market in Azerbaijan.

Overall, in December, taking into account the shares of other companies, OTC turnover of securities amounted to 674.3 million manats.

BSE stopped providing full information on OTC operations after in 2012 information was released on sales of controlling stakes in several companies that previously belonged informally to the former Economic Development Minister Farhad Aliyev. The former Chairman of the Supervisory Board of the BSE signed disclosure rules on OTC transactions that made "classified" the names of companies, whose securities became traded outside the stock exchange by a notary or a brokerage company. --08B