Republic of Azerbaijan: Selected Issues

Publication Date: June 11, 2014
Electronic Access: Free Full text (PDF file size is 691KB).
Use the free Adobe Acrobat Reader to view this PDF file

Summary: This Selected Issues paper uses a bank-level panel dataset to investigate the determinants of bank interest spreads in Azerbaijan over 2002–2013. The dealership model of Ho and Saunders is applied, supplemented by market structure and macroeconomic environment variables, to assess the extent to which high spreads of banks in Azerbaijan can be related to bank-specific variables or to a low degree of competition, controlling for macroeconomic factors. It is found that interest spreads are affected by operation cost efficiency, credit risk, liquidity risk, bank size, bank diversification, banking sector competition, policy rate, and reserve requirement.
Series: Country Report No. 14/160
Subject(s): Financial sector | Interest rates on deposits | Interest rates on loans | Bank rates | Credit risk | Liquidity | Lapse of time consideration | Selected issues | Azerbaijan

Publication Date: June 11, 2014
ISBN/ISSN: 9781498314473/1934-7685 Format: Paper
Stock No: 1AZEEA2014002 Pages: 29
US$18.00 (Academic Rate:
US$18.00 )
Please address any questions about this title to