The government has decided to reduce the volume of support to recapitalize the distressed banks.
By government’s regulation the support will be reduced by 530 million somoni - from 3.850 billion somoni to 3.320 billion somoni.
By the same regulation the government orders to issue bonds to the tune of 530 million somoni to support endorsement of the country’s energy sector.
The regulation also excludes Tajprombank and Fononbank from the government’s regulation of December 12, 2016.
The regulation should be endorsed by Tajikistan’s lower hose (Majlisi Namoyandagon) of parliament.
Recall, the distressed banks – Tajik Sodirot Bonk (TSB), Agroinvestbonk, Tajprombank and Fononbank -- last year experienced severe problems in providing account-holders with their own savings. The shortage of hard cash also meant that banks servicing salaries — often for government departments — were unable to pay the intended recipients.
The government on December 21 issued bonds to the tune of 3.850 billion somoni (equivalent to around $490 million at the exchange rate as of December 21, 2016), which then were supposed to go toward covering the more than $500 million cost of recapitalizing the distressed banks.
TSB was supposed to get 2.25 billion somoni (284 million USD at exchange rate as of December 21) and Agroinvestbonk -- 1.7 billion somoni (215 million USD)
Tajprombank and Fononbank were supposed to get 450 million somoni (56 million USD) and 80 million somoni (10 million USD) respectively – totaling 530 million somoni.
But by Tajik central bank’s decision licenses of Tajprombank and Fononbank for carrying out banking activities were withdrawn on February 24, 2017.