Baku: Moody’s has reported that Azerbaijan’s banking sector has successfully decreased its vulnerability to external shocks.

According to Azeri-Press News Agency, this development is part of broader economic improvements observed in Kazakhstan, Azerbaijan, and Uzbekistan, where significant efforts have been made to diversify economies and enhance economic resilience.

Moody’s notes that regional banking systems have created substantial buffers to manage moderate shocks effectively. The aftermath of the pandemic and the 2014-15 currency crisis in numerous developing countries led to a reduction in dollarisation within banks, which in turn has made them less susceptible to external financial disturbances.

Moreover, Moody’s predicts that the corporate sector in the region will benefit from sound business and financial profiles, robust liquidity, and state support. These factors are expected to aid large, mostly state-owned entities in navigating ongoing economic challenges effectively.