The Islamic Corporation for the Development of the Private Sector (ICD is a member of the Islamic Development Bank) is negotiating with two new banks in connection with the extension of funding for small and medium business in Azerbaijan, IDB Baku office told Trend on Tuesday.
"Besides the new banks, the corporation continues negotiating with ICD existing partner banks in Azerbaijan," the bank said. "A list of partner banks can be extended after the process of assessing the financial condition of the new banks is completed."
The banks must submit reports on financial indices as of 2012, the information on the branch network, including those in the regions, the structure of the bank, financial condition, etc. within the assessment. "Only after evaluating the data, the corporation will make a decision to open a credit line," the IDB office said.
The corporation stressed the readiness to allocate $40 million to Azerbaijani banks to develop small and medium enterprises (SME) in 2011.
It was reported that the ICD has been holding talks with the country's five or six banks. Information on terms of cooperation with the corporation, which received their audit finance accounts, was sent to these banks.
At present, the credit lines are being opened for existing partners.
The corporation has already invested around $80 million in Azerbaijan's economy and established cooperation with eight banks and gave loans to the International bank of Azerbaijan (IBA), Rabita Bank, UniBank, Standard Bank and Turan Bank.
The corporation delivered a loan worth $15 million at 9% per annum to the International bank of Azerbaijan in summer 2011.
ICD is also ready to directly support local companies. CIIC, established by the corporation together with the Azerbaijan Investment Company, may act as an agent.
The corporation invested funds through its subsidiary companies - Caspian International Investment Company (CIIC), the Ansar Leasing Company (5 million manat).
The ICD already has similar direct financing projects in the country. The Islamic Corporation allocated funds to the Baku Plaza Tourism Enterprises JSC to construct a new Park Bulvar Shopping Mall in Baku. Funds worth $20 million were allocated under the Musharaka and Murabaha programmes and will run for five years with a one-year grace period. The area of Park Bulvar Shopping Mall is 15,371 square metres.
Taghiyev said when choosing the projects, preference is given to companies which are ready to finance half of the project and it shouldn't be less than $5 million. The main condition for the ICD is a company audit to see it the financial state.
Islamic Corporation for Private Sector Development was established by the Board of Directors of the IDB at the 24th annual meeting of the Bank, held in Jeddah in 1999.