S&P on impact of money repatriation from Russia on bank deposits in Azerbaijan

A notable contribution to the growth of deposits of individuals in Azerbaijan’s banking sector came from repatriation of diaspora money from Russia, Report informs referring to the Azerbaijani banking sector’s study by the international rating agency S&P Global Ratings.

“This, however, might have a temporary impact, with deposit growth subsequently likely to return to pre-2022 levels,” reads the report.

There is some anecdotical evidence of Russian citizens relocating to Azerbaijan or the Azerbaijani diaspora in Russia moving its funds to Azerbaijan from Russia, but the macroeconomic effect of this is insubstantial so far, according to the study.

“However, retail deposits demonstrated growth of 17% for the first seven months of 2022 versus 5% for the same period in 2021,” S&P noted.