BAKU, Oct 28 (Reuters) - The state-run International Bank of Azerbaijan (IBA) has completed its recovery, plans to set up its own investment company and is preparing for its planned privatisation, the bank’s management board chairman told Reuters.
Azeri President Ilham Aliyev ordered in 2015 the privatisation of the oil-rich country’s biggest bank after a clean-up to get rid of distressed assets resulting from poor management.
Two years later IBA proposed a plan to restructure $3.3 billion of its debt, later receiving approval from creditors holding 93.9 percent of the affected debt.
The restructuring process has been completed with the support of the government, which holds more than 95.15%.
“The bank’s recovery process has been completed and we have already begun to implement the development strategy, which will be run until 2022,” Abbas Ibrahimov told Reuters in an interview.
Ibrahimov said that main goal of the strategy was “to ensure the bank’s sustainable growth, operational efficiency and a good corporate governance system.”
He said that earlier this month the bank’s shareholders approved setting up an investment company “to implement new business ideas” and, as he described it, to offer alternative investment products to corporate and high-income clients.
Ibrahimov said it was necessary “to ensure the development of the bank and to increase its market value” before planned privatisation.
The European Bank for Reconstruction and Development (EBRD) has said it might be interested in buying a stake in IBA. Ibrahimov did not specify when the bank would be ready for privatisation.
IBA has earlier planned to be ready for privatisation last year but the Azeri finance ministry said in May it did not plan to privatise IBA this year.
Ibrahimov said that the bank’s assets rose to 9.3 billion manats ($5.5 billion) as of the end of September from 8.3 billion manats a year ago, its loan book stood at 2.25 billion manats from 1.7 billion manats thanks to “economic activity in the country, as well as rise of the bank’s capital and number of its clients.”
The bank’s operating profit totalled 250 million manats, while capital increased to 1.5 billion manats by the end of September.
Ibrahimov said that positive financial results, including profitability, allowed the bank to pay dividends to its shareholders in the amount of 0.0326 manats per share or 150 million manats in total on last year’s results.
$1=1.7 manats Writing by Margarita Antidze; editing by Katya Golubkova and Louise Heavens