Azerbaijan

Azerbaijan’s SOCAR is interested in buying Russia’s Antipinsky oil refinery, although specifics from the Russian side are not known yet, SOCAR’s deputy vice president told Reuters. Sberbank, Russia’s largest lender, is in talks with potential investors to sell the Siberian refinery after gaining the rights for the majority of the indebted business, Reuters reported. “We are interested in this purchase indeed, but proposals are not defined yet,” Vitaly Baylarbayov told Reuters on Thursday at the annual Caspian Oil and Gas conference in the Azeri capital, Baku.

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The European Bank for Reconstruction and Development may start discussions with the International Bank of Azerbaijan (IBA) over its privatisation later this year, the EBRD’s manager in the South Caucasus country said. Azeri President Ilham Aliyev ordered in 2015 the privatisation of the oil-rich country’s biggest bank after a clean-up to get rid of distressed assets resulting from poor management, Reuters reported. Two years later the state-run IBA proposed a plan to restructure $3.3 billion of its debt, later receiving approval from creditors holding 93.9 percent of the affected debt.

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The International Bank of Azerbaijan (IBA) is working with a consultant to prepare a recovery strategy ahead of its privatisation, the head of its supervisory board said. State-run IBA restructured its $3.3 billion in international debt in 2017 after receiving approval from creditors, Reuters reported. “We are currently working with a well-known international consultant company on a business strategy for a recovery of the International Bank and are going to begin its implementation this year,” Shahmar Movsumov said.

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International Bank of Azerbaijan, the state-owned lender that defaulted on foreign debts, said it had enough support from creditors to implement a $3.3 billion debt-restructuring plan, Bloomberg News reported. Creditors holding more than 87 percent of the debt affected by the proposal have voted in favor, a day before the deadline, the bank said in a statement on Wednesday. Two-third support is required to make the proposal binding under Azeri rules.
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Azerbaijan’s biggest bank has offered creditors, including Fidelity and Allianz, a series of concessions in a bid to calm disquiet over its $3.3bn restructuring, amid claims that its mishandling of the issue could hurt the country’s investor profile, the Financial Times reported. The state-run International Bank of Azerbaijan, under pressure from a US lawsuit, was forced into negotiations with a group of investors last week. The bank has offered creditors new terms, including extra amortisation payments on new debt, a guaranteed choice of new bonds and an increased interest payment.
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When Azerbaijan’s biggest bank wanted to raise hundreds of millions of dollars from funds in neighboring Kazakhstan, it headed 2,700 miles in the opposite direction to Ireland, Bloomberg News reported. The International Bank of Azerbaijan, or IBA, used obscure Dublin-based entities to sell bonds that were bought by state-linked funds in Kazakhstan about three years ago. Now, the Baku-based lender has defaulted and its long-time chief executive officer is in jail for embezzlement, while a $22 billion national pension fund across the Caspian Sea in Almaty is probing its investment in the debts.
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International Bank of Azerbaijan, the energy exporting country's biggest lender, said on Wednesday a London court had supported its request to prevent creditors pursuing legal action in the United Kingdom, giving it time to restructure $3.3 billion (£2.5 billion) in debt, the International New York Times reported on a Reuters story. A similar decision was made by a U.S. court last month.
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A “too big to fail” trade has backfired on the shores of the Caspian Sea. The International Bank of Azerbaijan is imposing haircuts on holders of $3.3 billion of foreign debt after suffering loan and currency losses, the International New York Times reported. Creditors who had counted on the government to keep propping up the state-owned lender have been taught a painful lesson. The falling price of oil has had harsh effects on Azerbaijan and its banks.
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Investors dismayed at being forced to accept a 20 percent principal writedown in a debt restructuring of Azerbaijan’s biggest bank were met with a warning that it may be shut down if creditors fail to back the plan, with the finance minister saying the lender never had the benefit of full sovereign guarantee, Bloomberg News reported. The International Bank of Azerbaijan proposed swapping $3.3 billion of its foreign-currency debt and deposits into a mix of new sovereign securities and the lender’s own bonds, according to a presentation in London on Tuesday.
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