BAKU, Azerbaijan, Apr.16
By Zeyni Jafarov - Trend:
The underwriting service is in the highest demand for legal entities for financial instruments in Azerbaijan’s investment market, the local MFX Trading investment company told Trend.
According to a representative of the company, this is due to the recent growth in the number of legal entities wishing to take debt by issuing bonds.
"Raising funds in this way has a number of advantages over the standard type of lending in Azerbaijan. Thus, these services do not require collateral or surety from a third party," the representative said. “Another distinctive feature of underwriting functions in the capital market is also the company’s ability to sell bonds not to one, but to several parties, which reduces the risk of simultaneous withdrawal of funds by all lenders.”
Besides, he noted that underwriting applications continue to grow, which can be considered satisfactory given the realities of the COVID-19 pandemic period and the company's recent entry into the capital market.
Speaking about the differences in relation to the trade turnover of financial instruments in the capital market, the representative stressed that they include the absence of derivatives, as well as a small range of trading instruments.
"The Baku Stock Exchange holds meetings with the Borsa Istanbul and Korea stock exchanges to eliminate these shortcomings. Expanded work is underway in this direction, and we hope to see their results soon," summed up the company’s representative.
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