BAKU, Azerbaijan, August 4. As of July 1,
Azerbaijan's banks held net foreign assets of 31.217 billion manats
($18.36 billion).


According to calculations by Trend based on data from the Central Bank of
Azerbaijan (CBA), net foreign assets increased by 1.128 billion
manats ($663.5 million), or 3.7%, from the previous month and by
5.094 billion manats ($3.00 billion), or 19.5%, from a year
earlier.


As of the reporting date, banks' net domestic assets totaled
21.707 billion manats ($12.77 billion), up 295.6 million manats
($173.9 million), or 1.4%, month over month, but down 637.4 million
manats ($374.9 million), or 2.8%, from July 1 last year.


As a result, Azerbaijan's net foreign assets exceeded net
domestic assets by 9.509 billion manats ($5.59 billion), or about
1.4 times, as of July 1.


During the reporting period, 22 banks operated in Azerbaijan
with combined assets of 60.940 billion manats ($35.85 billion),
total liabilities of 53.295 billion manats ($31.35 billion) and
total equity of 7.646 billion manats ($4.50 billion).


Against the backdrop of rising foreign assets in the banking
sector, CBA officials said the country's banking system remains
financially resilient and that there is no need to change the
current course of monetary policy.


CBA Governor Taleh Kazimov told a news conference following the
announcement of the central bank's interest rate corridor
parameters that there is currently no reason for the regulator to
switch to a "Plan B."







"The macroeconomic environment and current regulatory indicators
provide sufficient grounds to continue our existing policy course.
That is why we are continuing to implement the strategy we have
chosen," Kazimov said.


He added that all central banks prepare contingency plans for
different scenarios and that one of the key elements of successful
monetary policy is the ability to respond quickly to changing
economic conditions.


"We believe the current monetary policy will provide an adequate
response to potential challenges the economy may face over the
medium and long term," Kazimov said.


The CBA governor also said the banking sector has sufficient
financial resources to expand lending. According to Kazimov, after
mandatory reserves are deducted, the banking system has about 6
billion manats ($3.53 billion) in excess liquidity, of which 4.6
billion manats ($2.71 billion) could be used for lending or
capitalization.


"The banking sector fully complies with all of our liquidity
requirements. Even after taking those requirements into account,
our calculations show the sector still has 4.6 billion manats
($2.71 billion) in available funds. Banks can direct these
resources toward both capitalization and lending," Kazimov
said.