Banking in Azerbaijan
Encyclopedia
The Central Bank of Azerbaijan is the central bank of Azerbaijan
which is charged with regulating the money supply, circulating currency, and regulating the commercial banks of the country. However, the banking system in Azerbaijan is small relative to GDP and ineffective in capital allocating. An estimated $1 billion is held in cash or outside the banking sector. There are approximately 70 foreign and local banks in Azerbaijan. Of the four state-owned banks, only the International Bank of Azerbaijan
(IBA) was solvent in 1999. The IBA was in the process of being privatized in that year. Major commercial banks include the Promtekhbank, Azakbank, Azerdemiryolbank, Bacobank, Gunay International Bank, Halgbank, ILKBANK, and the Universal Bank. Most businesses use the IBA, or the British Bank of the Middle East, Baku.
reports that in 2001, currency and demand deposits — an aggregate commonly known as M1—were equal to $363.6 million. In that same year, M2 — an aggregate equal to M1 plus savings deposits, small
time deposits, and money market mutual funds—was $738.5 million. The discount rate, the interest rate at which the central bank lends to financial institutions in the short term, was 10%.
, known as the BSE, opened in 2001 trading short-term treasury bonds and the common stock of recently privatized state-owned enterprises. Trading volume in the first six months was just under $1 million. A regulatory framework for the new exchange is under development and is expected to conform to international transparency standards.
Azerbaijan
Azerbaijan , officially the Republic of Azerbaijan is the largest country in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded by the Caspian Sea to the east, Russia to the north, Georgia to the northwest, Armenia to the west, and Iran to...
which is charged with regulating the money supply, circulating currency, and regulating the commercial banks of the country. However, the banking system in Azerbaijan is small relative to GDP and ineffective in capital allocating. An estimated $1 billion is held in cash or outside the banking sector. There are approximately 70 foreign and local banks in Azerbaijan. Of the four state-owned banks, only the International Bank of Azerbaijan
International Bank of Azerbaijan
The International Bank of Azerbaijan is the state-controlled bank operating in the Republic of Azerbaijan. Headquartered in Baku, the bank consists of 36 branches and 95 service outlets in more than 40 cities....
(IBA) was solvent in 1999. The IBA was in the process of being privatized in that year. Major commercial banks include the Promtekhbank, Azakbank, Azerdemiryolbank, Bacobank, Gunay International Bank, Halgbank, ILKBANK, and the Universal Bank. Most businesses use the IBA, or the British Bank of the Middle East, Baku.
Central Bank
The central bank increased the minimum required capital for commercial banks to $1.5 million in 1999, and expected to increase the figure to $3 million in 2001 (the latest year for which data was available), effectively consolidating the sector. The International Monetary FundInternational Monetary Fund
The International Monetary Fund is an organization of 187 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world...
reports that in 2001, currency and demand deposits — an aggregate commonly known as M1—were equal to $363.6 million. In that same year, M2 — an aggregate equal to M1 plus savings deposits, small
time deposits, and money market mutual funds—was $738.5 million. The discount rate, the interest rate at which the central bank lends to financial institutions in the short term, was 10%.
Stock exchange
The Baku Stock ExchangeBaku Stock Exchange
The Baku Stock Exchange is the main stock exchange in Azerbaijan. A member of the Federation of Euro-Asian Stock Exchanges , BSE is organized in the form of closed joint stock company with 18 shareholders...
, known as the BSE, opened in 2001 trading short-term treasury bonds and the common stock of recently privatized state-owned enterprises. Trading volume in the first six months was just under $1 million. A regulatory framework for the new exchange is under development and is expected to conform to international transparency standards.