BAKU, Azerbaijan, December 22. S&P international rating agency has affirmed long-term and short-term issuer credit ratings of Azerbaijani Azer-Turk Bank at "B+/B", Trend reports.
According to S&P, the outlook on the ratings is stable.
"The bank's long-term and short-term ratings balance Azer-Turk Bank's overall small position in the domestic market and the rapid growth of consumer and mortgage lending, which consumes its capital, as well as the controlling stake held by the state, which is positive for the bank's reputation and business development. They also take into account the planned changes in the bank's strategy for the next few years," analysts of the agency said.
The agency analysts said the stable outlook for the next 12 months reflects S&P's expectation that the bank's business and financial profiles will remain stable in line with its new growth strategy.
"Going forward, we could upgrade the ratings if the bank achieves a significant domestic market share, which would take a significant amount of time, while maintaining capital and asset quality metrics," the agency said.
According to S&P, the funding profile of Azerbaijan's banking system has strengthened over the past few years.
"The banking sector is a net external creditor. We assess the sector's net dependence on external debt as favorable compared to the average of similar global banks. We assess economic and sector risk trends for the country's banks as stable, reflecting generally balanced risks for the next 12-18 months," the agency said.
Azer-Turk Bank was established in May 1995. The main shareholder is the State Service for Property Affairs of Azerbaijan (75 percent). The bank's shareholders are also Turkish Ziraat Bank, Azerbaijani reinsurance company AzRe Tekrarsigorta and Azerbaijani specialized life insurance company Qala Heyat Sigorta.
