Azerbaijan, Baku, Feb. 18 / Trend, I. Khalilova /
The level of the banks' liquidity for the timely fulfillment of obligations to creditors and borrowers remained at an acceptable level during 2012. The analysis of the payment term of assets and liabilities confirms this, the Azerbaijani Central Bank's (CBA) report on financial stability in the country said today.
"Despite a slight decline in the share of highly liquid assets (by 2.5 percentage points) in the total amount of the banks' assets in connection with the restored credit activity, the share of highly liquid assets remained at a level above the minimum level (10 percent)," the report said. "Along with this, the acid-test ratio was 66.8 percent, exceeding the CBA's minimum limit by 30 percent."
"Preventive regulation and improvement of risk management systems in banks allowed maintaining asset quality at an adequate level," the report says.
The average daily balance of highly liquid assets increased by 95.6 million (4.7 percent), reaching 2.145 million Manat compared to 2011.
As of January 1, 2013, the share of cash, nostro accounts and state securities hit 27.7 percent, 23 percent and 18.3 percent in the structure of highly liquid assets respectively. The share of bank accounts in the Central Bank in liquid assets at the end of the reporting period was 32 percent.
The Central Bank has been assessing the quality of the loan portfolio of the banking sector at an acceptable level since early 2012. At the end of the reporting period, the share of overdue loans in the total portfolio was 6 percent.
In general, the stress tests carried out by the CBA on a regular basis show the stability of the Azerbaijani banking system to sharp macroeconomic shocks.
"The capital adequacy ratio remains stable," the report said. "Along with this, market and liquidity risks are being improved and credit risks are manageable."
The official exchange rate is 0.7847 AZN/USD on Feb. 18.
