National Bank of Azerbaijan
Encyclopedia
The Central Bank of Azerbaijan (CBA) is the central bank
of Azerbaijan Republic. The headquarters
of the bank are located in the capital city Baku
.
's monetary authority
, and is responsible for the conducting the country's monetary policy
and regulation of the banking and payment system
. Primary objective of CBA as stated in the Act on CBA is price stability. Secondary objective is to support a banking and payment stability.
The CBA is owned by the Republic of Azerbaijan and managed by the Executive Board
of the CBA. The Board is responsible for the supervising the administration and activities of the bank and for other statutory tasks. The bank is governed under the Act on the CBA, passed in 2004.
The bank has regional branch offices in Nakhichevan
, Ganja
, Yevlakh
, Khachmaz
, Goychay
and Bilasuvar
and the National Assembly
.
Governor - Elman Rustamov
Board Members - Alim Guliyev, Aftandil Babayev, Vadim Khubanov and Khagani Abdullayev
According to results of the plebiscite in 19 Mar 2009 the Bank has renamed as Central Bank of Azerbaijan
in the banking sector was reduced when the CBA increased the limit on participation of banks with foreign ownership from 30 to 50 percent of the commercial banking market. In June 2002, the NBA liberalized some overseas transfer provisions for Azerbaijani legal residents, including an increase of advance payments for import transactions from $10,000 to $25,000 and waiver of all restrictions for withdrawing foreign currency in cash
.
During the world economic crises in 2008-2009 monetary policy
orientation of Central Bank of Azerbaijan has strictly expanded: refinancing rate
was cut down from 15% up to 2%, reserve requirement ratio form 12% up to 0.5% . In exchange rate policy CBA maintained financial stability
holding a pegged regime
against the US dollar .
In postcrisis period some elements of economic overheating started to appear and Central Bank of Azerbaijan reacted with policy tightening since Autumn of 2010. So, refinancing rate
was gradually enhanced up to 5.25 percent.
Central bank
A central bank, reserve bank, or monetary authority is a public institution that usually issues the currency, regulates the money supply, and controls the interest rates in a country. Central banks often also oversee the commercial banking system of their respective countries...
of Azerbaijan Republic. The headquarters
Headquarters
Headquarters denotes the location where most, if not all, of the important functions of an organization are coordinated. In the United States, the corporate headquarters represents the entity at the center or the top of a corporation taking full responsibility managing all business activities...
of the bank are located in the capital city Baku
Baku
Baku , sometimes spelled as Baki or Bakou, is the capital and largest city of Azerbaijan, as well as the largest city on the Caspian Sea and of the Caucasus region. It is located on the southern shore of the Absheron Peninsula, which projects into the Caspian Sea. The city consists of two principal...
.
Mission and ownership
CBA is AzerbaijanAzerbaijan
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...
's monetary authority
Central bank
A central bank, reserve bank, or monetary authority is a public institution that usually issues the currency, regulates the money supply, and controls the interest rates in a country. Central banks often also oversee the commercial banking system of their respective countries...
, and is responsible for the conducting the country's monetary policy
Monetary policy
Monetary policy is the process by which the monetary authority of a country controls the supply of money, often targeting a rate of interest for the purpose of promoting economic growth and stability. The official goals usually include relatively stable prices and low unemployment...
and regulation of the banking and payment system
Payment system
A payment system is a system used for transferring money. What makes it a "system" is that it employs cash-substitutes; traditional payment systems are negotiable instruments such as drafts and documentary credits such as letter of credits. With the advent of computers and electronic...
. Primary objective of CBA as stated in the Act on CBA is price stability. Secondary objective is to support a banking and payment stability.
The CBA is owned by the Republic of Azerbaijan and managed by the Executive Board
Board of directors
A board of directors is a body of elected or appointed members who jointly oversee the activities of a company or organization. Other names include board of governors, board of managers, board of regents, board of trustees, and board of visitors...
of the CBA. The Board is responsible for the supervising the administration and activities of the bank and for other statutory tasks. The bank is governed under the Act on the CBA, passed in 2004.
The bank has regional branch offices in Nakhichevan
Nakhichevan
The Nakhchivan Autonomous Republic is a landlocked exclave of Azerbaijan. The region covers 5,363 km² and borders Armenia to the east and north, Iran to the south and west, and Turkey to the northwest...
, Ganja
Ganja, Azerbaijan
Ganja is Azerbaijan's second-largest city with a population of around 313,300. It was named Yelizavetpol in the Russian Empire period. The city regained its original name—Ganja—from 1920–1935 during the first part of its incorporation into the Soviet Union. However, its name was changed again and...
, Yevlakh
Yevlakh
Yevlakh is a small city in Azerbaijan, 265 km west of capital Baku. It is surrounded by, but administratively separate from, the rayon of the same name...
, Khachmaz
Khachmaz (city)
Khachmaz is a city in the Khachmaz Rayon of Azerbaijan.-Origin of the name:...
, Goychay
Goychay (city)
Goychay is a city and municipality in and the capital of the Goychay Rayon of Azerbaijan...
and Bilasuvar
Bilasuvar
Bilasuvar is a rayon of Azerbaijan.It has been said that the ancient name was Pileh-Swar that in Persian means "the elephant-riding person " , named after one of the Buyid dynasty amirs. The name in Turkic means pure water falls, due to the area's numerous rivers, though given the largely flat...
Executive Board
The Executive Board is composed of the Governor, who is the chairman of the Board, and 4 members appointed in double process by PresidentPresident of Azerbaijan
The country of Azerbaijan is a presidential republic, with the President of Azerbaijan as the head of state, and the Prime Minister of Azerbaijan as head of government...
and the National Assembly
National Assembly of Azerbaijan
The National Assembly , also transliterated as Milli Majlis is the legislative branch of government in Azerbaijan. The unicameral National Assembly has 125 deputies: previously 100 members were elected for five-year terms in single-seat constituencies and 25 were members elected by proportional...
.
Governor - Elman Rustamov
Elman Rustamov
Elman Rustamov is an Azerbaijani politician. He is currently governor of Azerbaijan Central Bank.-Biography:Rustamov was born 29 June 1952 in Jabrail district of Azerbaijan. He is married and has three children.-Education:...
Board Members - Alim Guliyev, Aftandil Babayev, Vadim Khubanov and Khagani Abdullayev
History
In early 1992, former Soviet banks were incorporated into the National Bank of Azerbaijan; The 1992 Law on Banks and Banking Activity and the Law on the National Bank established the CBA as the top level of the new system and commercial banks (state and private) on the second level. However, in 1993 the system was undermined by poor technology, large unresolved debts among state- enterprises, irregular participation by enterprises, and bank delays in transferring funds. The main bank for the exchange of funds among private and state enterprises is the Industrial Investment Joint Stock Commercial Bank.According to results of the plebiscite in 19 Mar 2009 the Bank has renamed as Central Bank of Azerbaijan
Monetary policy
A limitation on FDIFDI
-Medical:* FDI World Dental Federation, Fédération dentaire internationale. The World Dental Federation also have an , also known as the FDI.* first dorsal interosseous, one of the four dorsal interossei muscles of the hand -Finance:* FDi magazine, a UK-based publication that covers foreign direct...
in the banking sector was reduced when the CBA increased the limit on participation of banks with foreign ownership from 30 to 50 percent of the commercial banking market. In June 2002, the NBA liberalized some overseas transfer provisions for Azerbaijani legal residents, including an increase of advance payments for import transactions from $10,000 to $25,000 and waiver of all restrictions for withdrawing foreign currency in cash
Cash
In common language cash refers to money in the physical form of currency, such as banknotes and coins.In bookkeeping and finance, cash refers to current assets comprising currency or currency equivalents that can be accessed immediately or near-immediately...
.
During the world economic crises in 2008-2009 monetary policy
Monetary policy
Monetary policy is the process by which the monetary authority of a country controls the supply of money, often targeting a rate of interest for the purpose of promoting economic growth and stability. The official goals usually include relatively stable prices and low unemployment...
orientation of Central Bank of Azerbaijan has strictly expanded: refinancing rate
Interest rate
An interest rate is the rate at which interest is paid by a borrower for the use of money that they borrow from a lender. For example, a small company borrows capital from a bank to buy new assets for their business, and in return the lender receives interest at a predetermined interest rate for...
was cut down from 15% up to 2%, reserve requirement ratio form 12% up to 0.5% . In exchange rate policy CBA maintained financial stability
Economic stability
Economic stability refers to an absence of excessive fluctuations in the macroeconomy. An economy with fairly constant output growth and low and stable inflation would be considered economically stable. An economy with frequent large recessions, a pronounced business cycle, very high or variable...
holding a pegged regime
Fixed exchange rate
A fixed exchange rate, sometimes called a pegged exchange rate, is a type of exchange rate regime wherein a currency's value is matched to the value of another single currency or to a basket of other currencies, or to another measure of value, such as gold.A fixed exchange rate is usually used to...
against the US dollar .
In postcrisis period some elements of economic overheating started to appear and Central Bank of Azerbaijan reacted with policy tightening since Autumn of 2010. So, refinancing rate
Interest rate
An interest rate is the rate at which interest is paid by a borrower for the use of money that they borrow from a lender. For example, a small company borrows capital from a bank to buy new assets for their business, and in return the lender receives interest at a predetermined interest rate for...
was gradually enhanced up to 5.25 percent.
See also
- Economy of AzerbaijanEconomy of AzerbaijanAzerbaijan is an economy that has completed its post-Soviet transition into a major oil based economy , from one where the state played the major role...
- Azerbaijan manat
- Banking in AzerbaijanBanking in AzerbaijanThe 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...
- List of banks in Azerbaijan