Azerbaijan's Banking Sector Shows Resilience Amidst Challenging Economic Conditions
Date
6/29/2024 10:51:59 PM
(MENAFN- AzerNews)
banking Sector Shows Resilience Amidst Challenging Economic Conditions Image' Width='242' Height='268'/>
Ulviyya Shahin
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As of June 1 this year, Azerbaijan's banking sector has
demonstrated robust performance, highlighted by significant
increases in both assets and loans amidst evolving economic
conditions.
The total assets of Azerbaijan's banking sector reached 49.1475
billion manats, marking a notable 7% rise compared to the previous
year. This growth underscores the sector's resilience and ability
to expand despite external challenges.
A pivotal indicator of the sector's health, net loans to
customers accounted for 23.7199 billion manats, reflecting a
substantial 22.1% increase year-over-year. This expansion elevated
the share of loans in total assets from 42.3% to 48.3%, indicating
a growing focus on extending credit to stimulate economic
activity.
The liabilities of the banking sector increased by 6.8% to
42.8178 billion manats. Of particular note is the deposit
portfolio, which rose by 6.6% to 34.8352 billion manats. This
growth was bolstered by a 10.3% increase in individual deposits,
totaling 13.3995 billion manats, and a 4.4% rise in corporate
deposits, amounting to 21.4357 billion manats. Such increases in
deposits underscored growing confidence among both individuals and
businesses in the banking system.
The sector's capital also saw a healthy increase of 8.4%,
reaching 6.3297 billion manats. This capital growth provides a
buffer against risks and supports the sector's capacity to expand
lending activities while maintaining stability.
Notably, the liabilities of banks to the Central Bank of
Azerbaijan decreased significantly by 2.3 times over the past year,
amounting to 47.1 million manats. This reduction indicates improved
liquidity management and reduced reliance on central bank funding,
reflecting enhanced financial health within the sector.
Azerbaijan's banking sector has demonstrated resilience and
growth amidst challenging economic conditions. The significant
increases in assets, loans, and deposits illustrate a robust
performance trajectory, supported by prudent management practices
and growing confidence from both individual and corporate
depositors. Moving forward, sustaining this momentum will be
crucial, ensuring continued stability and contribution to
Azerbaijan's economic development.
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