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Economical news
Bulletine Economics 

2017 October 03 ( Tuesday )  17:12:38
Print version
Русский Azərbaycan


Net Loss of Azersu Increased by 11.3%

Baku / 03.10.17 / Turan: According to the results of 2016, the net loss of Azersu OJSC amounted to 612.921 million manat, the company said in its financial statements for 2016.

Compared to 2015, the loss increased by 11.3%.

Revenues of Azersu from services to subscribers amounted to 159.837 million manat, which is 14.9% more.

The assets of Azersu last year decreased by 6.9%, amounting to 608.345 million manat, and the liabilities decreased by 1.9%, amounting to 970.125 million manat. -----71D

CIIC Works at Loss, but Issues Dividends

Baku / 03.10.17 / Turan: CJSC Caspian International Investment Company (CIIC), whose main shareholders are investors from the Arabian Gulf, completed 2016 with a profit. However, the source of profit is not economic activity, but the difference in the exchange rate, due to which the shareholders were given dividends.

In 2016, according to the balance sheet, the company in which JSC Azerbaijan Investment Company has a 24% equity interest, gained AZN 834,000 from the investment activity in the capital of several companies, of which 145,600 manats is recorded in profit. However, due to high administrative expenses, the result of CIIC's operating activity became negative by 940,000 manat.

But still CIIC managed to complete 2016 with a profit, as it did in the previous year. Part of the profit (493,000 manat) is interest income on bank accounts, and over 3 million manat is the exchange rate difference. It should be noted that following the results of 2015 CIIC shareholders were affected by the devaluation, the amount of which exceeded 9.5 million manat.

According to the report!/mediainformation/annual-reports, the net profit of CIIC in 2015 and 2016 was 5.5 million and 2 million manat. At the end of 2015, the shareholders distributed over 3.9 million manat among themselves. And in February of this year, the shareholders were given dividends for a total of 4 million manat.

CIIC was established in 2008. In 2016, the company Saham Holding left the shareholders by selling its stake (14.48%) to Aref Investments Company.

CIIC takes part in the capital of seven Azerbaijani companies (Amara LLC - 100%, A-Agro LLC - 68%, Salat LLC - 68%, Agro Trading LLC - 100%, A-Plastic LLC - 53.1% and T-Tomatoes LLC - 33%). ------08B

Share of EU Countries in Trade Turnover of Azerbaijan 35%

Baku / 03.10.17 / Turan: The share of the European Union countries in the trade turnover of Azerbaijan is 35%, Economy Minister Shahin Mustafayev said at a meeting with the newly appointed head of the EU representation in Azerbaijan Kestutis Jankauskas, the ministry said.

The Minister noted that over the past 10 years, the share of EU countries in the total volume of investments in the fixed capital of Azerbaijan was 46%, and their share in direct investments in the non-oil sector was 35%.

The Minister stressed that until now the EU has provided technical assistance to Azerbaijan in the amount of 582 million EUR.

In turn, Jankauskas said active work is currently underway on the agreement between the EU and Azerbaijan.

He noted that Azerbaijan and the EU fruitfully cooperate in the energy sector. "Among the priorities is the non-oil sector. Due to the rich tourist potential of Azerbaijan, more tourists from Europe can be attracted to the country," he said. 71D

More than 200 Companies to Take Part in Construction Exhibition

Baku / 03.10.17 / Turan: The 23rd Azerbaijan International Construction Exhibition World Build Baku 2017 will be held at the Baku Expo Center from October 18 to 21.

This year more than 200 companies from 23 countries will take part in the exhibition. The national pavilions will be performed by Germany, Iran and the UAE. Poland will take part in the exhibition with the national stand for the first time. The exhibition is also widely represented by producers of building materials and construction companies of Azerbaijan, the organizer of the exhibition, Iteca Caspian, reports.

The State Housing Development Agency provides official support to the World Build Baku 2017 exhibition. The goal of the State Agency is to ensure the needs of the country's citizens for housing, and to provide construction of multi-apartment buildings that meet environmental and energy efficiency requirements. -----08D

MONEYVAL Committee Satisfied with Azerbaijans Actions to Combat Money Laundering

Baku / 03.10.17 / Turan: At the plenary meeting of the Committee of Experts on the Evaluation of Measures to Combat Money Laundering and Financing of Terrorism (MONEYVAL) of the European Council held in Strasbourg last week, a new report on the progress of Azerbaijan in these areas was discussed. As reported by the Financial Markets Supervision Authority (FIMSA), the Committee approved the report of the Azerbaijani government following the discussions.

The international network of investigative journalists in September this year revealed the laundering of 2.9 billion US dollars in 2012-2014 with the participation of the International Bank of Azerbaijan (IBA) and the Estonian bank Danske Bank. These amounts settled in the bank accounts of high-ranking officials in the Parliamentary Assembly of the Council of Europe and other persons for questionable purposes.

During the discussion of the report, the MONEYVAL secretariat pointed out that Azerbaijan had achieved "tangible progress" over the past 3 years and fulfilled many obligations to unify with international standards on the regime for combating money laundering and financing of terrorism.

The report of the Azerbaijani government lists measures to reform the financial system and implement the recommendations of MONEYVAL. The delegation from Azerbaijan led by the chairman of the FIMSA Board of Directors Rufat Aslanli participated in the meeting.

It is noteworthy that among other reasons that led to the actual bankruptcy of the IBA, the Ministry of Finance cited an example of transfer of billions of US dollars to offshore accounts, allegedly for the implementation of some projects and secured by collateral in securities. The fate of these funds is not known. The government does not respond to scandalous publications in international media about laundering $ 2.9 billion. No criminal proceedings have also been instituted against these dubious banking transactions. ------08D

Saturday Activity of Banks Causes Stir in Foreign Exchange Market

Baku / 03.10.17 / Turan: The inhabitants of Azerbaijan know about devaluation not by hearsay. The national currency fell sharply twice - in February and December 2015. As a result of these falls, the manat dropped from the bar of 0.79 gapiks (kopecks) per dollar to 1.55 manat. Over the next two years, the manat exceeded the mark of 1.70, and most economists call it the third, smooth devaluation. After two devaluations, talk about the third one coming does not abate, and economists give disappointing forecasts, despite statements of the chairman of the National Bank Elman Rustamov that he does not see risks for the manat. It went so far that even the innocent news that all banks would work on Saturday caused panic, and people rushed to banks, buying up dollars. Why do not people believe in the national currency, what is the threat, and should we expect new devaluation?

According to the economist Natig Jafarli, the distrust of the population is quite understandable: "If the head of the body that controls the country's currency, that is, the National Bank, told the population before the devaluation that "no devaluation is expected, so do not worry," and a few days later the manat lost its value, it is natural that people"s confidence in the national currency and in the country"s financial system as a whole has weakened. This is due not only to the activities of the National Bank. Closure of several banks, problems with the return of deposits to the population destroyed confidence in the financial and banking system. Therefore people can be understood and news like Friday"s news cause panic and is perceived as a signal of new devaluation. This is a big problem for the economy. If there is no confidence in the economy, the financial and banking system, and the national currency, neither ordinary people nor businessmen can plan their affairs, make deposits and investments. This is turning into a sign that is causing great damage to the country"s economy."

The expert stressed that, given the situation with the Azerbaijani economy, the fall of the manat can begin every moment: "At the beginning of the year SOFAZ administratively allocated AZN 7.5 bn to the National Bank and at the expense of the Financial Stability Fund it is possible to maintain the stability of the manat in relation to the US dollar. The cost of the manat in relation to other currencies is falling, but in relation to the dollar, the manat rate has so far been kept. However, everyone understands that this happens in the administrative order, and the rate of manat against the dollar is kept due to certain measures."

Despite this, N. Jafarli believes that devaluation should not be expected until the end of this year, because the National Bank has been allocated a fairly serious amount of funds: "However, in December, several important decisions are expected to be taken on a global scale. An official statement has already been made about raising the interest rate of the Fed. In addition, from today, the Federal Reserve"s liquidity reduction program will be launched. This means that the Fed will return the dollar supply issued in the form of loans back from the markets. These events may cause growth of the dollar index in the world. In addition, in neighboring Turkey during the last week there was a fairly serious increase in the dollar. Similar processes in the neighboring countries do not remain without consequences in Azerbaijan and influence the rate of AZN. Therefore, at the end of the year there can be certain changes in the ratio of the exchange rate of the manat to the dollar."

The expert believes that the most troubled period will start next year: "If SOFAZ does not allocate a new amount of funds to the National Bank to maintain liquidity and support financial stability (and it will be difficult to do this because the Fund has large expenses for large projects), fairly serious changes will be expected in the AZN rate in relation to USD," N. Jafarli said. -0-

USD Exchange Rate Did Not Change, EUR Slightly Decreased

Baku / 03.10.17 / Turan: At the currency auction of the Central Bank on Tuesday, the US dollar rate did not change, remaining at the level of 1.7002 manat.

Commercial banks buy USD in the range of 1.6850 - 1.7010 manat, and sell it at 1.6920 - 1.71 manat.

On October 3, EUR decreased from 2.0023 manat to 1.9904 manat per 1 EUR.

Commercial banks sell EUR at 1.9930 - 2.2020 manat, and buy it in the interval of 1.94 - 1.9930 manat. -71D-

86,186 Electronic MTPL Contracts Concluded

Baku / 03.10.17 / Turan: In September of this year, 86,186 electronic contracts on compulsory motor third party liability (MTPL) insurance were registered in the Compulsory Insurance Bureau information system. 13,920 of them were compulsory insurance contracts concluded with respect to motor vehicles that were registered abroad and entered the territory of the Republic of Azerbaijan for transit purposes.

The amount of insurance premiums collected by insurance companies under concluded contracts for the indicated period amounted to 6,834,654 manat. In comparison with the same period last year, the number of insurance contracts and the value of premiums increased by 24% and 21%, respectively.

Since November 1 of last year, MTPL contracts have been registered in Azerbaijan exclusively in the form of an electronic document. Contracts concluded on paper before this date will be valid until the expiration date.

Currently, 13 insurance companies operate in the country under the MTPL category, which are participants of the Compulsory Insurance Bureau (OJSC Ateshgah, OJSC Standard Insurance, OJSC Ata Insurance, OJSC Khalg Sigorta, OJSC Pasha Sigorta, OJSC AXA MBASK, OJSC AzSigorta, State Insurance Commercial Company of Azerbaijan, OJSC Mega Sigorta, OJSC Ipek Yolu Sigorta, OJSC Azerbaijan Senaye Sigorta, OJSC Gala Sigorta, and OJSC Gunay Sigorta). ------71D

Situation with Lending in Banks of Azerbaijan

The situation with credit interest was not stable in the banks of Azerbaijan in September. Last month there were changes in interest rates for both consumer and business loans. In several banks, interest rates increased, and in several cases, it was on the contrary.

E.g., Access Bank changed the annual interest from 24-28% to 28%, and the annual interest of construction and repair loans changed from 25-28% to 28%.

Express Bank reduced annual interest rates of pawn loans from 36-38% to 33-36%.

In the Baku branch of Bank Melli Iran, the annual interest on cash loans decreased from 29% to 22-26%, on auto loans from 26% to 18-25%, and on pawn loans from 25% to 21%.

In Rabita Bank the annual interest on cash loans was reduced from 30-32% to 26-30%, and on pawn loans it was raised from 24-29% to 24-36%. The bank restored auto loans from 18-22% and mortgage loans from 24-26%.

Bank VTB Azerbaijan began to issue cash loans at 28% per annum to those who receive salaries on their plastic cards.

Commercial bankAnnual interest for consumer loans (AZN)
CashAutoPawnMortgageRepair / Construction
1Access Bank29%25-28%-28%28%
2AFB Bank26-30%----
3AG Bank-----
4Amrah Bank-----
5Ata Bank-----
6International Bank of Azerbaijan (IBA)27-29%----
7Azerbaijan Senaye Bank27%--27%-
8Azer-Turk Bank22-26%----
9Bank AvrasiyaIndividuallyIndividually---
10Bank of Baku23-32%----
11Bank BTB32-38%25-27%34%23%-
12Bank Respublika28%-26-36%--
13Bank Silk Way16-18%----
14Bank VTB Azerbaijan28%----
15Demir Bank26%----
16Express Bank28-30%-33-36%22-26%-
17Gunay Bank24%----
18Khalg Bank-----
19Capital Bank29%----
20Bank Melli Iran - Baku Branch22-26%18-25%26%21%-
21Mugan Bank-----
22Nakhchivan Bank17-18%16-18%-11%-
23NBC Bank23-32%10-26%---
24Nikoil Bank25-31%16-2227-28%20%-
25National Bank of Pakistan - Baku Branch-----
26Pasha BankIndividually----
27Rabita Bank26-30%18-22%24-36%24-26%
28Turan Bank17-29%18-21%29-36%-20-24%
29Uni Bank23-29%----
30Yapi Kredi Bank Azerbaijan28%23-24%-19-20%-
31Ziraat Bank AzerbaijanIndividuallyIn dividually-Individually-

Commercial bankAnnual interest for consumer loans (USD)
CashAutoPawnMortgageRepair / Construction
1AFB Bank13-17%----
2Azer-Turk Bank14-16%----
3Bank BTB-13-15%-23%-

As for business loans, in Bank of Baku the annual interest rates of macro loans decreased from 23-28% to 23-25%.

Demir Bank also changed the annual interest of micro loans from 25-30% to 26%, and on macro loans from 16-23% to 16%.

At NBC Bank, the annual interest rate of micro loans increased from 21-23% to 27-29%, and the annual interest rate of macro loans increased from 20-24% to 21-25%.

Commercial bankAnnual interest for business loans
Micro loansMacro loans
1Access Bank28%19-22%28%19-22%
2AFB Bank20-24%-18-30%8-16%
3AG Bank----
4Amrah Bank----
5Ata Bank----
7Azerbaijan Senaye Bank---10-12%
8Azer-Turk BankIndividuallyIndividuallyIndividuallyIndividually
9Bank Avrasiya----
10Bank of Baku26-32%-23-25%
11Bank BTB16%16%IndividuallyIndividually
12Bank Respublika26-28%15%IndividuallyIndividually
13Bank Silk Way----
14Bank VTB Azerbaijan----
15Demir Bank26%-16%-
16Express Bank25-30%-20-25%-
17Gunay Bank----
18Khalg Bank---16-23%
19Capital Bank----
20Bank Melli Iran - Baku Branch21-23%-21-23%-
21Mugan Bank----
22Nakhchivan Bank15%---
23NBC Bank27-29%-21-25%-
24Nikoil Bank20%10%20%10%
25National Bank of Pakistan - Baku Branch16-17%-16-17%-
26Pasha BankIndividuallyIndividuallyIndividuallyIndividually
27Rabita Bank25-27%-22-26%14-18%
28Turan Bank24-26%-FərdiFərdi
29Uni Bank28%-14%14%
30Yapi Kredi Bank Azerbaijan----
31Ziraat Bank AzerbaijanIndividuallyIndividuallyIndividuallyIndividually

Foreign currencies rates fixed by Central Bank

1 ABŞ dollarıUSD1.7002
1 AvroEUR1.9904
1 Avstraliya dollarıAUD1.3263
1 Argentina pesosuARS0.0979
1 Belarus rubluBYN0.8649
1 Braziliya rialıBRL0.5389
1 BƏƏ dirhəmiAED0.4629
1 Cənubi Afrika randıZAR0.1247
100 Cənubi Korea vonuKRW0.148
1 Çexiya kronuCZK0.0768
100 Çili pesosuCLP0.2662
1 Çin yuanıCNY0.2555
1 Danimarka kronuDKK0.2674
1 Gürcü larisiGEL0.6875
1 Honq Konq dollarıHKD0.2177
1 Hindistan rupisiINR0.0259
1 İngilis funt sterlinqiGBP2.2534
100 İndoneziya rupiasıIDR0.0125
100 İran rialıIRR0.0045
1 İsveç kronuSEK0.2076
1 İsveçrə frankıCHF1.7392
1 İsrail şekeliILS0.4801
1 Kanada dollarıCAD1.3569
1 Küveyt dinarıKWD5.6251
1 Qazaxıstan tengəsiKZT0.005
1 Qırğız somuKGS0.0247
100 Livan funtuLBP0.1127
1 Malayziya rinqqitiMYR0.401
1 Meksika pesosuMXN0.0931
1 Moldova leyiMDL0.0968
1 Misir funtuEGP0.0963
1 Norveç kronuNOK0.212
100 Özbək somuUZS0.0211
1 Polşa zlotasıPLN0.4614
1 Rusiya rubluRUB0.0293
1 Sinqapur dollarıSGD1.2452
1 Səudiyyə Ərəbistanı rialıSAR0.4534
1 SDR (BVF-nun xüsusi borcalma hüquqları)SDR2.3961
1 Türk lirəsiTRY0.4751
1 Tayvan dollarıTWD0.0558
1 Tacik somonisiTJS0.1932
1 Yeni türkmən manatıTMT0.4858
1 Ukrayna qrivnasıUAH0.0639
100 Yapon yeniJPY1.5027
1 Yeni Zelandiya dollarıNZD1.2181