Growing Share of Problem Loans

Central Bank of Republic of Azerbaijan has published the report for January-September. According to the central controller, the total loan portfolio of the financiers of 1 October was 19 billion 113.5 million manats, of which 1 billion 353.8 million manats or 7.06% were problem (overdue and "hanging") loans.

In comparison with indicators of October 1 last year, the volume of troubled loans grew by 380.6 million manats, or 39.11%. If the result can be partially attributed to the devaluation of the February (minus 34.5% to the US dollar), the rest of the unreturned loans were motivated by reduction of capabilities of entrepreneurs and users of consumer loans. Thus, the volume of bad loans only for a month, September 1, increased by 20.2 million AZN (1.51%), which is the devaluation of indirect relevance.

According to the CBA, during the month investment in the economy in the form of loans decreased by 982.3 million manats or 4.89%. Central Bank justifies this by restructuring measures in the International Bank of Azerbaijan (IBA). --17D-

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