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Number and volume of placements in primary share market decline 41% and 27% as a result of tax concessions expiration in Azerbaijan

09 August 2012 13:27 (UTC +04:00)

Baku. Nijat Mustafayev â€“ APA-Economics. Azerbaijanâ€™s security market continued its activity on the background of anti-inflationary monetary policy and changes of several structural factors, said the report of State Committee for Securities on first half of 2012.

Report says although corporate securities market volume decreased during January-June, the growth in government securities market positively influenced the dynamics of the market and security market rose 55% to AZN 5.8 bln.

â€œVolume of operations via government securities soared 64% to AZN 5.6 bln. Conduction of conservative borrowing policy by the Ministry of Finance caused observation of significant lags in the volume of government bonds. So, government bonds market made AZN 37 mln, down 81% from year earlier. Totally, the growth on this segment of market was realized from CB notes and repo operations. So, volume of CB notes rose 25%, secondary market of this instrument soared 31%, totally increased by 25% to AZN 616.7 mln. Number and volume of repo operations surged 8.9% 81% to AZN 4.9 blnâ€, the report said.

Moreover, despite the decline in total volume of corporate securities market during the repotting period, the number of operations rose. That is, compared to last year, the number of operations in corporate securities market grew by 12.5%, but as a result of backlog in dynamics of corporate debt instruments, the marketâ€™s volume declined by 30% to AZN 231.2 mln. â€˜Despite the backlog of sharesâ€™ initial market, the increase of operationsâ€™ number and volume in secondary market of securities has totally provided positive dynamics of the marketâ€™.

The decline in bonds of Azerbaijan Mortgage Fund and operationsâ€™ number has negatively affected the dynamics of debt market in total. That is, in Q1, 2012, the numbe rof operations in corporate bonds market decreased by 7.9%, volume â€“ 41.6% and made AZN 146.6 mln.