Azerbaijan's Banks Earn AZN 950m as Assets Grow 12.2%

Azerbaijan's banking sector posted net profit of AZN 949.7 million ($558.6 million) in January to August 2026, according to Trend calculations based on Central Bank of Azerbaijan data, as the sector's balance sheet kept growing at double-digit rates.

A bigger, more loan-heavy system

Total assets reached AZN 62.48 billion ($36.75 billion) on 1 September, up 12.2% from a year earlier. Net loans to customers rose 14.3% to AZN 30.84 billion, lifting the share of loans in total assets from 48.5% to 49.4%. Deposits grew 14.45% to AZN 41.79 billion, while total liabilities rose 12.6% to AZN 54.72 billion.

Equity grew more slowly, up 9.55% to AZN 7.75 billion. With liabilities growing faster than capital, the sector's leverage is edging up, although equity still equals about 12.4% of assets.

Where the profit comes from

Azerbaijani banks remain highly liquid. With loans at under half of assets, a large part of their balance sheets sits in liquid assets rather than credit to the economy. That mix protects profits when credit growth slows, but it also means banks are not yet the main channel for financing the non-oil economy that the government wants to grow.

The biggest lenders set the pace. PASHA Bank's loan book passed AZN 4 billion in the first half, and Unibank this week announced a $50 million term facility from Dutch development bank FMO. Broad money supply (M3) grew 15.1% in the year to 1 September, according to central bank data, which is consistent with the deposit growth seen in the banks.

Consolidation continues

The sector is also getting smaller in headcount. The liquidation of Azerbaijan Credit Bank was completed this month, the latest step in a long clean-up that has cut the number of licensed banks since the 2015-2016 devaluations. Payment cards in circulation are near 23 million, reflecting fast growth in cashless payments. Lending is also spreading geographically: banks report strong loan and deposit growth in Karabakh and East Zangezur, where state reconstruction spending is pulling in businesses and households.

The caveats

An eight-month profit figure without a comparable 2025 base should be read with care, and the aggregate hides wide differences between the largest banks and smaller lenders. Consumer lending has been a major driver of loan growth in recent years, and it is an area regulators watch closely. With inflation projected above 5% next year, the path of interest rates will be the main factor for bank earnings into 2027.

Sources: Central Bank of Azerbaijan via Trend and Report.az, 28 September 2026.