The Central Bank of Azerbaijan (CBA) will begin applying macroeconomic instruments of counter-cyclic character as part of its monetary policy of 2010. CBA has said that it would introduce a new system of prudential reporting and integrated system of early warning, create a single model and develop standards of stress testing, start creating risk management incubator.
In a statement CBA said: “Next year the Bank plans to take the following moves to raise the level of risk management in banking sector: to continue policy of financial reservation and capitalization; to maintain liquidity; strengthen banking sector within the counter-cycling framework; to toughen supervision over quality of credit portfolios; to increase potential of corporate governance and risk management in banks.”
Within the framework of its authority CBA has set four challenges for 2010 – inflation maintenance at low level, maintenance of manat exchange rate stability, keeping of stability of financial and banking sector and meeting of money demand of economic sector within the framework of inflation.
