OREANDA-NEWS. September 23, 2008. Starting global financial crisis made banks reconsider their credit practice.

One of Azeri bankers informed that for objective reasons commercial banks of Azerbaijan ought to interrupt crediting developing by impetuous rates recently.

“Interruption of crediting first of all, will concern individuals’ consumer crediting. We will keep crediting clients having serious auspicious credit history,” the banker said.

The leading country’s banks have already canceled credit programs.

“Cancelling the credit programs is not caused by direct order of the National Bank of Azerbaijan (NBA). NBA only recommends to be very careful at crediting and follow the quality of credit portfolio and pledging. By implication it has introduced additional measures to increase market steadiness of banks – renewed requirements on assets/capital ration, reserve requirements and reserving on foreign borrowings,” the banker stated.

The commercial banks’ decision is linked with apprehension regarding foreign liquidity.

“Many banks will be impacted by the events at world financial markets. On the one hand, cost of resources for them will grow and on the other hand, foreign commercial banks will postpone projects of direct and syndicated crediting, IPO and purchases of shares. So far international financial organizations such as the European Bank of Reconstruction and Development, International Finance Corporation, say that the events at world markets will not influence their cooperation with Azerbaijani banks,” the banker said.

Nevertheless, local business follows local market more attentively.

“The events at Russian financial market will impact on situation in the country more as our business is deeply connected with Russian market,” the banker stated.

In this connection domestic banks support the efforts of the Central Bank and Ministry of Finance of Russia for supporting liquidity of the national banking sector.