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FEDERATION OF EURO-ASIAN STOCK EXCHANGES SEMI ANNUAL REPORT APRIL 2007
BAKU INTERBANK CURRENCY EXCHANGE
Farkhad Amirbekov
General Manager of BBVB
One more important mission, which has
had a long preparation is the gradual
transformation of Baku as the financial
center of region. In my opinion, for this
purpose there are many preconditions.
The BBVB work is directed toward becoming
an integrated part of a market economy and
in particular the development of the financial
market of Azerbaijan. Today, the BBVB is
focused on the development of international
links for the accelerated development of the
Azerbaijan financial market.
One of the most important directions of this
development is through the BEST trading
system which allows for electronic trade for
the monetary needs of the market.
The introduction of “a currency swap”
operation has given banks the new tool
of management for working with current
liquidity. The BBVB aspires to increase, first
of all, the number of participants in trading,
the quantity of trading financial tools all the
while trying to develop technical
opportunities in trading and clearing
systems.
The BBVB gives special importance to
realize the complex strategy of corporate
management in conditions of the impressive
economic growth of Azerbaijan and further
the increase in demand for financial services.
One more important mission, which has
had a long preparation is the gradual
transformation of Baku as the financial center
of region. In my opinion, for this purpose
there are many preconditions.
HISTORY AND DEVELOPMENT
The Central Bank of Azerbaijan and the four
biggest state banks of Azerbaijan Republic
founded the Baku Interbank Currency
Exchange (Baki Banklarasi Valyuta Birjasi-
BBVB) on 26 July 1993 and this year it
marks a decade from the moment of the
start of activity in the financial market. From
the beginning of the activity one of the
central financial institutions of the country,
the BBVB is today for the business public of
Azerbaijan an original symbol of economic
reforms. Using the advanced information
technologies and being based on
successful experience in the creation of the
universal trading platforms, the BBVB has,
based on volumes of trades and number of
financial tools become the largest exchange
institute in the Caucasian region.
The purposes of the BBVB are as follows:
• to set up regular exchange trading to carry
out currency operations;
• to determine the market exchange rate of
the Azerbaijan currency (manat) to foreign
currencies;
• to create a mechanism for inter-state
settlements;
• to maintain management and information
services for currency operations;
• to settle transactions made at the BBVB
both in national and foreign currencies;
• to organize and carry out exchange
trading and auctions with interbank credits;
• to conduct exchange trading with futures.
MAJOR HISTORICAL DATES
18 October 1991
Declaration of Independence of the
Azerbaijan Republic
15 August 1992
Putting in circulation national
currency–Manat
21 June 1993
Establishment of the BBVB
PAGE 40
26 August 1994
Beginning of regular exchange trading in the
currency market
31 March 1995
First credit auction of the National Bank at
the BBVB
20 September 1996
First t-bill auction
22 January 1997
First exchange trading in the BBVB Stock
Department
30 August 1997
Beginning of trading in the Organized
Interbank Currency Market (OICM)
25 September 1997
First trading in the OICM by means of
universal trading e-network of the BBVB
17 December 1997
Corresponding emerging market
membership status in FIBV
6 March 1998
Signing in Baku Protocol on cooperation of
BBVB with Istanbul Stock Exchange
2 October 1998
Full member of FEAS (Istanbul)
24 February 1999
Membership in the Azerbaijan Commercial
Chamber (Baku)
14 December 1999
Membership in the Azerbaijan Commercial
Banks Association (Baku)
20 April 2000
Co-founder and membership in the
International Association of CIS Exchanges
(Moscow)
3 July 2001
Signing in Moscow Arrangement on
strategic cooperation of BBVB with the
MICEX (Moscow Interbank Currency
Exchange)
27 March 2002
Start of e-system of trades on Interbank
credits-the Organized Interbank Currency
Market
9 July 2002
Start of Bourse E-System of Trades (BEST)
24 November 2003
Signing in Almati agreement on mutual
cooperation of the BBVB with the
Kazakhstan Stock Exchange
16 June 2004
Signing in Baku agreement on mutual
cooperation of the BBVB with the Bulgarian
Stock Exchange
16 June 2005
Start of the tool-currency swap in BEST
1 January 2006
Technical transition of BEST system for
using denominated manat
FUTURE OUTLOOK
In 2007, the BBVB plans include:
• Modernization and reorganization of the
BBVB website;
• Development of settlement and clearing
services, in particularly software for
management of banks trading limits on
credit and the currency markets;
• Improvement of the risk management
system in realization of clearing operations;
• Further increasing professional skills of the
Exchange’s personnel;
• Development of modern corporate
governance principles;
• Introduction of the International system in
field of GAAP (General Accepted Accounting
Principles);
• Implementation of a new trading system;
and
• Expansion of external contacts with
international and regional organizations.