S&P: Azerbaijan's banks exhibit lower private sector debt compared to peers in region

S&P Global Ratings expects lending growth in Azerbaijan to slow down to 10%-12% in 2026, in line with 2025, compared to an annual average of 18% in the previous four years, Report informs.

"We estimate systemwide stage 3 loans under International Financial Reporting Standards (IFRS) will be broadly stable at 4.5%-5%, despite our projected economic slowdown due to stagnating oil and gas output. We forecast credit costs under national standards at 1.1%-1.4% in 2026. Overall, Azerbaijan's banks exhibit lower private sector debt to GDP of about 26% compared to peers in Georgia, Armenia, and Uzbekistan, and are on par with Kazakh and Kyrgyz banks. They also have the lowest foreign currency lending in the region at about 16% at year-end 2025," reads the message.