Reduction of Azerbaijani banks' deposit base in April 2014 was not of a systemic nature and it was rebalanced in May, the Central Bank of Azerbaijan (CBA) announced on June 11.
"There have been different ideas in media on the reduction of the volume of deposits and increase of the number of unprofitable banks. In this regard, the Central Bank reported that the economic cycles, seasonal factors and the behavior of investors, prompted by various reasons affected the dynamics of deposits. The decline observed in April was compensated by a huge growth in May," the CBA said.
The dynamic growth of the deposit base of the Azerbaijani banks amounted to 40 percent over the past 10 years. In 2013 the amount of deposits in banks increased by 25 percent.
The CBA also noted the increase in the number of unprofitable banks is a result of enforcing more conservative policies for assets provision.
"This does not create any risks or dangers to the financial position and activities of the banks. The mentioned indicators are concerned with the results of the banks' works in the first five months of this year," CBA added.
In January-April, the depositary base of the Azerbaijani banks increased by 9.1 percent. As of May 1, the total volume of bank deposits and the deposits of the legal and physical entities amounted to over 13.6 billion manats compared to over 11.4 billion manats in early May 2013.
In the reported period, the profit of 33 banks amounted to 171.39 million manats and losses of 11 banks reached to 33.67 million manats, which allowed the banking system to earn 137.72 million manats from the net profit.
Some 44 banks are operating in Azerbaijan.