Main obstacles in recovery of distressed assets identified

Key factors hindering the recovery of distressed assets have been identified.

As reported by Oxu.Az, this was stated by Azer Amirov, Director of the Legal Department of the Deposit Insurance Fund, at the forum "National Press Day: Dialogue and Cooperation."

According to him, the biggest obstacle to this is the judicial and enforcement process.

"In banks undergoing liquidation, the main difficulties are related to large business loans. The situation with consumer loans is better. For instance, after the liquidation of DəmirBank began, the majority of its client base consisted of microloans, which is why the recovery rate for this bank turned out to be higher compared to other banks being liquidated. Collecting debts on business loans is a more complex process, since corporate clients use not only loans but also letters of guarantee, letters of credit, settlement services, and other banking products. As a result, obligations to a bank in the liquidation stage take a back seat, leading to delays. This, in turn, gives rise to court proceedings. In many cases, deficiencies made during the loan processing stage prolong court proceedings," he noted.

The fund's representative added that the enforcement proceedings stage begins after the court's decision.

"Complaints are filed against bailiffs, which slows down the enforcement process. As a result, the recovery of funds is delayed," A. Amirov emphasized.