OREANDA-NEWS. July 25, 2011. The International Bank of Azerbaijan (IBA) has summed up for the first half-year of 2011, reported the press-centre of IBA.

As 1news.az reports with reference to the IBA, since the beginning of the year the bank's assets grew by 8% and at the end of the first half-year amounted to 4 billion 951 million manats.

"This does not include the financing of public projects by the Central Bank serviced by the IBA, the amount of which currently stands at over 955 million manats," – says the report.

The loan portfolio over six months increased by 7% (more than 200 million manats) and amounted to 3 billion 153 million manats, or about 39% of the credit market.

About 60% of credits issued are non-state sector, mainly in the spheres of industry (45 million manats), Trade and Services (103 million manats) and agriculture (9.6 million manats).

Loans worth 26 million manats were issued to individuals ( car loans, mortgage and collateral loan, and others), which shows the direct involvement of the bank in the social sphere of the republic.

In all of this, the proportion of bad and dangerous loans at the end of six months was only 5.5% of the total loan portfolio, which in total is just over 169 million manats.

Confidence in the bank continues to grow both outside the country and in the domestic market. The IBA still has the largest client base in the region. At the end of June this year, the number of clients reached 767,000, of which 753 000 - individuals.

The Bank’s priority is to improve the quality of customer service. Thus, in 2010 last year, it was decided last year to optimize business processes in the branches and the process approaches its completion. In addition, it has already been for a year that a "CRM" project (customer relationship management) started and this project will give an opportunity to work more closely with customers of the bank, create a flexible system of servicing that allows to provide banking services individually depending on the nature and needs of our customers. The Bank is also actively continuing to build innovative customer service system, such as "Internet Banking", "Mobile Banking", "Electronic commerce" and other high-tech products, increasing the level of service.

Despite the fact that the bank has lowered interest rates on deposits, only over six months in 2011, fixed-term deposits from the public to IBA increased by 16% and made USD 603 million manats, while total deposits of individuals exceed 810 million manats. Income of the population from investments in the IBA over six months amounted to more than 33 million manats, and this is more by 37% against the same period last year.

In general, the bank's liabilities at the end of six months increased by 9% and made USD 4.26 billion manats.

The authorized capital of the only state-controlled bank as of July 1 this year amounted to 240 million manats and the balance capital rose in six months by 3.5% to 689 million manast. Over the six months the IBA transferred to the budget of the republic about 15 million manats of various taxes.

The IBA’s revenues as of July 1 totaled 170.8 million manats, while profit before tax amounted to more than 14.4 million manats.

Besides, at present, the number of active cards of the bank’s clients is more than 1.8 million pieces, and this is more than 40 % of the country's card market. For the six months of 2011 the turnover of card transactions totaled 1.4 billion manats. For comparison, in 2002 the number of cards in the International Bank of Azerbaijan was 28 thousand pieces, and the turnover of card transactions was at the level of 71 million U.S. dollars.

The IBA also develops its own acquiring network. At present in the big stores, famous boutiques, restaurants, hotels, etc. 3 thousand 613 POS-terminals were installed.

In addition, this year, continuing to expand its activities in international financial markets, the bank contributed to the successful implementation of projects and transactions in the first half-year, which allowed to attract more foreign investment to the country.

Thus, the IBA has concluded a number of loan agreements with major international banks and investment companies. New correspondent relationships were established with 90 financial institutions around the world.

During the reporting period the bank managed to attract funds from foreign sources (banks and investment funds) worth about 250 million U.S. dollars. For example, in February 2011 an agreement with the "Deutsche Bank" was signed on attraction of funds amounting to USD 50 million for the period of two years. Only from different foreign funds we have managed to raise more than USD 60 million. Also more than 100 million U.S. dollars were attracted from banks such as "Societe Generale", "VTB - France", "Amsterdam Trade Bank", "Demir Halk Bank", etc.

In addition to the above, for the first time in the history of Azerbaijan we managed to arrange a deal with the use of precious metal (gold) in order to raise funds in excess of USD 30 million through the structured finance instruments.

Given the lack of available funds on international financial markets, the IBA managed to attract most of the mentioned funds for more than 1 year, which along with other aspects is an irrefutable proof of a qualitatively new level of development of its international relations, the growth of confidence and high interest of foreign investors in the Azerbaijani bank.

At the same time, the IBA provides timely repayment of foreign loans made to them, that in modern conditions is extremely important. In 2008-2009 total amount of repayments was over USD 1 billion, for 2010 -172 660 000 U.S. dollars and 31.5 million euros. Within six months of this year, the bank repaid foreign debts amounting to 302.265.369 U.S. dollars and 27.5 million euros.

Moody's in its report emphasizes that the IBA is of strategic importance, as historically plays an important role in the implementation of public investment and economic policy, acting as agent for the government to finance large-scale projects of national importance for Azerbaijan.

The IBA today finances dozens of projects aimed at ensuring the modernization of Azerbaijan's economy. These are projects in the field of innovation, industry, construction and electricity. The Bank, in particular, has financed projects to develop wind power in the republic, the establishment of infrastructure for mobile communications, the development of metallurgical industry, agriculture and various industrial enterprises, and continues to work actively in this direction.