“State support and growth in the non-oil sector are strengthening the position of Azerbaijani banks. The outlook for Azerbaijan’s banking sector remains positive,” Moody’s international rating agency said in its report on the outlook for Azerbaijan’s banking system, APA-Economics reports.
According to the agency’s assessment, stable economic conditions in the country and the continued state support for the banking sector will support banks’ financial indicators over the next 12–18 months. During this period, the quality of bank assets and profitability are expected to be maintained.
Moody’s notes that rising household incomes and the expansion of the non-oil sector — the main area of banks’ operations — will contribute to credit growth and strengthen banks’ financial resilience. The existing capital buffers of banks, which remain sufficiently high, also increase their ability to absorb potential risks.
The report emphasizes that the Azerbaijani government’s capacity to support the sector, particularly large banks, remains strong. The agency adds that the positive outlook on the country’s sovereign credit rating is among the factors boosting confidence in the banking sector.
According to the agency, by December 2025, the combined reserves of the State Oil Fund of Azerbaijan and the Central Bank exceeded 108% of GDP. This provides the government with substantial financial capacity to support the economy and the banking sector. Meanwhile, the total assets of the banking sector amount to approximately 44% of GDP.
Follow us on Telegram
t.me/apanewsaz
Follow us on Instagram
Follow us on TikTok
Follow us on Facebook
Follow us on X
