Baku: Fitch Ratings has revealed that the central bank currently holds about 80% of the Mortgage and Credit Guarantee Fund’s (MCGF) outstanding bonds. This significant holding is part of a buyback guarantee that obliges the central bank to purchase bonds from bondholders upon request.

According to Azeri-Press News Agency, the financial profile of MCGF is bolstered by ongoing state support, which is reflected in its stable yet modest profitability and a resilient business model. The fund benefits from annual capital injections from the state, amounting to AZN172.7 million for the years 2024-2025. These funds have been allocated to finance social mortgages, and the fund is one of four entities in the country exempt from income tax.

Fitch Ratings also notes that the state provides indirect support to MCGF through the special risk group classification of the fund’s bonds and products. This classification enhances their attractiveness to banks compared to commercial bonds. The agency expects that regulatory and political factors will continue to strongly support MCGF in the medium term.

The state has announced plans to allocate AZN100 million in financing for 2026. These funds are primarily intended for social mortgages and subsidizing loans to small and medium-sized enterprises (SMEs).