In recent years, Bank of Baku OJSC has steadily decreased its reliance on market funds to 19% of total assets at the end of 2022 from 23-24% in 2019-2020, Report informs referring to Moody’s Investors Service in connection with the affirmation of long-term ratings of bank deposits in national and foreign currencies at B2. The rating outlook has been changed from stable to positive.
“The market funding is largely represented by a 5-year loan from the Central Bank of Azerbaijan due in 2024 and long-term loans from the national funds for entrepreneurship, mortgage, and agriculture support,” reads the report.
Moody's considers these funding sources stable and subject to modest refinancing risk.
“Despite the stability of these funds, BoB's loan-to-deposit ratio remains high at 153% at the end of 2022. As of the same date the bank's liquidity cushion was modest at 13% of total assets. The bank's liquidity is supported by a well-diversified and granulated retail customer base which accounts for over 90% of total deposits,” Moody’s noted.
Bank of Baku’s liabilities to the Central Bank and national funds as of July 1, 2023 amounted to 42.655 million manats ($25.091 million) against 63.982 million manats ($37.636 million) a year earlier.
The Bank of Baku has been operating since 1994. Its authorized capital is 52.87 million manats ($31 million). 35% of the bank’s shares are owned by NAB Holding, 31.1% by Ismayilov Hikmat Abuzar oglu (100% shareholder of Azsigorta OJSC, 99.6% by AFB Bank OJSC), 28.9% by Azpetrol Oil Company LLC, 5% by Isayev Elchin Hamid oglu (chairman of the Supervisory Board).