Weak banking system in Azerbaijan - Fitch Ratings

The state budget deficit of Azerbaijan in 2015-2016 can be up to 2% of GDP. As analysts of the international rating agency Fitch Ratings reported, the long-term Issuer Default Rating (IDR) of the country for foreign and local currency is BBB- with "stable" outlook. These are the same ratings of senior unsecured bonds in the country's foreign and local currency. The short-term IDR for foreign currency is F3.

Stability is ensured by a strong government balance sheet. The assets of the State Oil Fund in the first half reached $ 37.6 billion. "Given the foreign exchange reserves of the Central Bank of Azerbaijan in the amount of $ 15 billion. Gross sovereign external assets account for 69% of GDP. Fitch expects further moderate growth of sovereign assets by a decline in the current account surplus in 2014-2016 years ", - reads the information on the site. Analysts believe that in the event of a sharp decline in oil prices or a significant reduction in oil surplus funds will provide a "financial safety net".

The report emphasizes that "the banking system remains relative weakness of the economy. International Bank of Azerbaijan (IBA), which is majority state ownership and control of one-third of the assets of the banking system, has a problem with the quality of assets, despite the current recapitalization of 500 million manat," said the agency. --17D-

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