"Azerbaijan's economic growth prospects for 2024-2025 are weaker than most regional peers'. Pressure on economic growth relates mainly to a long-term gradual decline in oil output. We forecast real GDP growth in 2024-2025 at about 1.5% annually. However, we expect 10%-15% growth in the
banking sector in 2024, to a large extent supported by consumer lending growth," the S&P Global Ratings international rating agency stated, Paralel.Az-Economics reports.

S&P added that the banking system's funding profile has strengthened. "We have seen no material outflows of retail or corporate deposits since 2016. We think core customer deposits will fund loans over the next few years, eliminating the need for external funding."

The ratings agency stressed that the deposit dollarization has declined to regional peers’ levels. Also, volatile nonresident deposits, at 5%, are much lower than regional peers'.