Azernews.Az

The president of Russian oil giant LUKoil, ethnic Azeri Vahid Alakbarov sees as a key goal of the Nikoil bank its turning into a financial institution trusted by Azeris.
Alakbarov acquired the controlling stake in Nikoil, one of Russia`s biggest banks, after the Topaz Investments company he owns purchased 5,977,500 ordinary shares worth a total of 11.955 million manats ($14.4 million). The transaction granted Topaz Investments control over 53.1 per cent of stock in the bank operating in Azerbaijan and boosted Nikoil bank`s capital stock to 22.5 million manats ($27.1 million).
The LUKoil boss told a news conference in Baku last Wednesday that Nikoil bank had two priority targets - the development of small and medium business in Azerbaijan and promoting the expansion of Azeri-Russian economic relations.
The press conference held at the LUKoil office was also attended by the Nikoil bank Board Chairman Vasili Khamaza, the Presidents of the URALSIB finance corporation Nikolay Tsvetkov and of ISR Holding Iskandar Khalilov.
A new concept of Nikoil bank is under development. Observers say that the bank intends to step up work in two areas - allocating micro-loans to Azerbaijan`s small and medium enterprise sector and providing banking services to Azeri businessmen working in the neighboring country.
In 2007, Nikoil bank beefed up the amount of its fixed-term deposits by 69% to 44.8 million manats (over $53.9 million), while the bulk of credit investments in the Azerbaijani economy reached 96.7 million manats ($116.5 million), a 107% increase over just a year. Foreign investment to the tune of $31.4 million was attracted. Nikoil made net profit totaling $2.05 million. The bank opened subsidiaries in the capital Baku as well as in Yevlakh, Lankaran and Barda last year.
The Nikoil shareholders have set out a wide range of objectives to be met by the joint-stock company`s management in 2008. These include increasing the credit portfolio to about $209 million, attracting at least $108.5 million in fixed-term deposits in the domestic market, and increasing the amount of the attracted outside resources to $75 million.
Opening nine subsidiaries is among the outlined goals as well. Six of them will be based in the country`s regions, namely, in Guba, Geychay, Shamakhi, Tovuz, Shaki and Masally. Total capital spending on the activities will amount to almost $1.7 million.
The Nikoil bank was founded in 1997 by Russia`s URALSIB (61%), Azerbaijan`s ISR Holding (20%) and Russia`s URALSIB Invest company (19%). After recent changes in the bank`s capital structure, URALSIB has a 28.7% stake, while URALSIB Invest 13.9%, and ISR Holding 4.3%.

Favorable conditions
Alakbarov said there were favorable conditions in Azerbaijan to make not only the oil and gas sector but the entire domestic market attractive for foreign investment.
"Our company was one of the first ones to capitalize on the investment opportunities in the Azerbaijani market. We have operated here for as long as 16 years and believe that throughout these years, the investment climate in the country has only improved," the LUKoil president said.
Alakbarov said all the necessary mechanisms and conditions have been provided in Azerbaijan to facilitate business by foreign investors in a variety of fields including the banking sector and retail industry.
"We therefore believe that much depends today on investors and how active they are," he added.