Taleh Kazimov: Azerbaijan's banking sector risk profile improves

Azerbaijan's banking sector has recorded a significant improvement in its risk assessment, Central Bank of Azerbaijan (CBA) Governor Taleh Kazimov said.

According to Report, Kazimov made the remarks at the Second Azerbaijan International Investment Forum (AIIF 2026) in Baku.

He said international credit rating agencies had recognized ongoing efforts to improve the regulatory framework, increase transparency and strengthen the protection of consumer and investor rights in the banking sector.

"Together with strong macroeconomic and fiscal indicators, these efforts have supported a number of rating upgrades. This progress is also reflected in the assessment of the sector," Kazimov said.

According to S&P Global Ratings' Banking Industry Country Risk Assessment (BICRA), Azerbaijan's banking sector moved from group 9 at the end of 2023 to group 7 in 2026, reflecting a significant improvement in its banking-sector risk assessment.

"Taken together, these developments demonstrate the growing resilience of Azerbaijan's financial sector and create a stronger foundation for sustainable investment and long-term capital formation," he said.

Kazimov also said Azerbaijan is diversifying its sources of financing through Islamic finance and other sustainable financial instruments.

"We are working to broaden the range of financing options available to the economy. Islamic finance, including Islamic banking and capital markets, can provide an additional channel for attracting international financing and connecting Azerbaijan with a broader pool of investors," he said.

He added that sustainable finance also creates opportunities to align Azerbaijan's investment needs with growing global demand for environmentally and socially responsible investment.

"Green bonds, sustainability-linked instruments and other innovative financial products can help direct capital toward projects with long-term economic and environmental benefits," Kazimov said.

He noted that such diversification could increase the resilience of financial flows and improve the financial system's ability to support investment through different stages of the economic cycle.

"Strong partnerships can create a more resilient financial ecosystem. Uncertainties in global finance make cooperation not only desirable, but increasingly important and necessary," Kazimov said.

"By building stronger partnerships across sectors and institutions, we can create a more favorable financial ecosystem to support investment, economic growth and long-term prosperity. We remain committed to fulfilling our mandate of maintaining price and financial stability and contributing to sustainable economic development," he added.

Kazimov said he believed the future of the global economy would be shaped by the cooperation and partnerships being built, including those launched at the forum.