SOFAZ will continue to use services of Deutsche Bank subsidiary

SOFAZ will continue to use services of Deutsche Bank subsidiary Rating of Deutsche Asset & Wealth Management International GmbH downgraded last week
October 2, 2017 16:30
SOFAZ will continue to use services of Deutsche Bank subsidiary

Baku. 2 October. REPORT.AZ/ The State Oil Fund of Azerbaijan Republic (SOFAZ) is not yet going to give up the service of Deutsche Bank subsidiary “Deutsche Asset & Wealth Management International GmbH”, which was downgraded last week.

SOFAZ has clarified in response to Report’s enquiry.

Fitch International Rating Agency downgraded long-term rating of the bank from A- to BBB. Outlook rating was affirmed Stable.

The agency explained the downgrading with that it will take some time before the bank will be able to deliver on earnings targets. Deutsche Bank’s subsidiary is one of the external managers with 29% or $ 103.7 million share of stable-revenue generating SOFAZ assets.

“Selection criteria of external managers for management of the funds is determined with document “SOFAZ investment policy” approved on the annual basis. Moreover, before each manager is selected, comprehensive research is carried out and the information about relevant selection stages, including announcement of tender, results and so on is systematically conveyed to the public. According to modern requirements, credit rating of external manager or its parent company should not be below the investment grade of international credit agencies (Standard and Poor's, Fitch and Moody's) and the external managers in question are so.”

“Risk and revenue indicators of SOFAZ assets given to external managers are constantly under control and accountability is ensured. Moreover, in accordance with internal procedures monitoring of external managers’ current state of finance and activity is carried out. Of course, in line with relevant requirements of legislative acts regulating the Oil Fund’s activity relevant decisions are made on external managers”, statement said.  

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