Azerbaijani Politics 15 january — 07:43

Ilham Aliyev, addressing Elman Rustamov: 'This can become very dangerous trend'

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'You say that banks were given 2 billion manats of resources and all the same, consumer loans constitute majority in lending. And that could be a very dangerous trend.' As reports Azerbaijan State News Agency, President of Azerbaijan Ilham Aliyev said this at a meeting on the results of 2019, addressing Chairman of the Central Bank Elman Rustamov.

The head of state noted that the banking sector should more support the real sector of the economy.

'There should be such a mechanism in business lending so that banks are interested in it. And the Central Bank must follow this process. We cannot let it go. Of course, for some banks, consumer loans are a more profitable and easier way to generate income, but business loans are more important for the country's economy. Therefore, discuss these issues with the Ministry of Economy. The Entrepreneurship Assistance Fund is planning to issue soft loans worth about 170 million manats this year.

Reducing the discount rate will lead to the fact that the interest rate issued by private banks will approach the level of the interest rate of soft loans. Therefore, there should be a reconciliation. The banking sector is a great tool and should support the real sector of the economy. There should be no surprises from the banking sector. This year there should be very serious control over their activities. Including there should be a mechanism in connection with the issuance of suspicious loans, so that we can prevent this in advance. The responsibility of the banking sector has also increased, because we continued to insure all deposits. This is a very rare case on a global scale. We did this a few years ago to build trust. Currently, confidence in the banking sector is at a high level. The manat rate has been stable for more than three years, the economy is strengthening, the balance of payments is $6 billion. That is, there is no danger. Therefore, full state deposit insurance is a big step and this increases the responsibility of the banking sector. Control should be such that there are no surprises. And I think that the powers transferred to the Central Bank will help in resolving this issue,' said Ilham Aliyev.

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