BAKU, Azerbaijan, March 20. Azerbaijani banks increased their portfolio of consumer lending to micro, small and medium enterprises (MSMEs) in 2022, Trend reports via the financial stability report of the Central Bank of Azerbaijan.
According to the report, this figure amounted to 5.7 billion manat ($3.3 billion), up by 27.3 percent on annual basis.
Besides, last year, consumer lending grew most rapidly in Azerbaijan. In particular, business loans increased by 11.4 percent, to 10.85 billion manat ($6.38 billion), and mortgage loans - by 24.3 percent, to 2.98 billion manat ($1.75 billion).
The report noted that the pace of lending in 2022 peaked after the COVID-19 pandemic and began to stabilize.
"In July last year, changes in the regulatory framework to tighten requirements for consumer loans and soften mortgage loans led to a slowdown in the growth of consumer loans and the growth of mortgage lending at a higher rate. Moreover, by the end of the year, against the backdrop of a slowdown in economic growth, the growth also showed a decelerating trend," the report said.
In 2022, the lending portfolio for micro, small and medium enterprises increased by 28 percent - up to 5.7 billion manat ($3.3 billion), and the share of loans in this segment exceeded 50 percent. One of the factors leading to positive growth rates is the easing of requirements for MSMEs, the report added.
The loan portfolio of Azerbaijani banks totaled 19.59 billion manat ($11.52 billion) in 2022, thus, growing by 2.9 billion manat or $1.7 billion (17.6 percent) year on year.
Out of total loans, business loans accounted for 55.4 percent, consumer loans – 29.4 percent, and mortgage loans – 15.2 percent last year. In the portfolio of business loans, the largest share fell on loans issued in the sphere of trade and services (48 percent).
