AZERBAIJAN EMBRACES FINANCIAL REGULATORY PROGRESS WITH IMF SUPPORT

Azerbaijan Takes Significant Step Forward in Financial Soundness Indicators Compilation

Azerbaijan’s Central Bank of the Republic of Azerbaijan (CBAR) has made a major breakthrough in compiling financial soundness indicators (FSIs) with technical assistance from the International Monetary Fund (IMF). A recent mission, which took place in August 2022, aimed to assist CBAR staff in developing FSIs in line with the IMF’s 2019 Financial Soundness Indicators Compilation Guide.

Mission Objectives and Outcomes

The mission, supported by the IMF’s Middle East and Central Asia Department, worked closely with CBAR officials to:

• Review available source data for deposit takers (DTs) and map data to a new sectoral financial statements template
• Prepare accompanying metadata
• Discuss a timeline for regular reporting of FSIs
• Review available data for other financial corporations (OFCs) for the compilation of FSIs

Key Findings

• Compiled 14 core and 9 additional monthly FSIs for DTs
• Developed one additional monthly FSI on real estate markets and two quarterly FSIs on OFCs’ sector
• Improved source data quality, frequency, and timeliness for dissemination purposes

Recommendations for Continued Progress

To ensure continued progress, the mission recommended a detailed action plan with key deadlines. Priority recommendations include:

• Finalizing and submitting new FSIs sectoral financial statements and metadata to the IMF’s Statistics Department by December 31, 2022
• Starting regular reporting of FSIs data and metadata by January 31, 2023

Benefits of Azerbaijan’s Commitment to International Best Practices

Azerbaijan’s commitment to implementing international best practices in financial regulation will contribute positively to its economic stability and transparency. The IMF’s technical assistance will continue to support CBAR in achieving these goals, ultimately benefiting the country’s citizens and investors alike.