Gubad Ibadoglu: Distrust of Banks Grows

In the past five years, the population's deposits in Azerbaijani banks decreased by 2 billion AZN, or 20.1%. The reason is that the population disbelieves the banks more and more, according to Dr. of Economic Sciences Gubad Ibadoglu.

In his view, the instability of the situation of banks in recent years seriously concerns investors. ‘So, in January-May, the credit investments of banks decreased by 8.9% and non-performing loans increased by 9%, which further undermined the already shaken confidence in banks,’ he wrote on his Facebook page.

Following the closing of Tekhnika Bank, the clients of Bank Standard are also facing problems. In this situation, the depositors of other banks are also thinking about the withdrawal of their deposits.

This process becomes widespread and is a serious signal to the banking sector. However, the Central Bank and the Financial Markets Control House have taken a contemplative stance.

Another reason for withdrawal of deposits is the impoverishment of the population, which was a consequence of the crisis of the Azerbaijani economy, investment restrictions, rising unemployment, prices and inflation.

All this causes the people to withdraw their deposits from banks and spend their funds on consumption.   -03D-