BAKU, March 14 (Reuters) - AccessBank, one of the leading commercial banks in the oil-rich country of Azerbaijan, has completed its capitalisation with two international financial institutions turning shareholders and expects to swing to profit in 2020, a company official said.
Asian Development Bank (ADB) and European Investment Bank (EIB) are AccessBank’s two new major shareholders with 19.9 percent and 17.4 percent stakes, respectively, while International Finance Corp retained its 16.6 percent stake, Chief Executive Officer Anar Hasanov told Reuters.
All other shareholders with minor stakes are also non-residents.
Total recapitalisation package stood at 184 million manats ($108 million), with 118.5 million manats being injected into Tier I capital, as of end February this year, following which the total regulatory capital reached 75 million manats, Hasanov said.
Another 22 million manats will be recognised as Tier II capital component by mid-March, and 22 million manats will be reserved as contingent capital for the next two years, he added.
AccessBank reported a net loss of 11.6 million manats at the end of 2018 compared with a loss of 56.4 million manats in 2017, amid sharp devaluation of the national currency.
“We expect to report operation profit from the second quarter of this year and annual net profit in 2020,” Hasanov said, adding that the bank would continue its credit policy of financing micro, small and medium businesses.
The lender plans to allocate loans of 150 million manats this financial year. The company’s loan portfolio came in at 602.9 million manats at the end of 2018, down from 614.8 million manats a year earlier.
The bank’s total capital adequacy ratio is projected to be 12.2 percent at the end of 2019, above the minimum requirement of 10 percent, the CEO said.
The total capital adequacy ratio stood at 4.03 percent in 2018 and 6.38 percent in 2017.
AccessBank was founded in 2002 by foreign shareholders, including the European Bank for Reconstruction and Development, KfW and the German consulting company LFS Financial Systems.
$1 = 1.7 manats Reporting by Margarita Antidze; Editing by Sherry Jacob-Phillips