EBRD launches first manat-denominated bonds in Azerbaijan

• EBRD issues inaugural Azerbaijani manat (AZN) domestic bond
• Issue was auctioned over the Baku Stock Exchange
• Interest payments on the one-year floating rate note reference the AZIR-index

The European Bank for Reconstruction and Development (EBRD) has made its inaugural Azerbaijani manat (AZN) domestic bond issue, auctioned over the Baku Stock Exchange and cleared through the National Depository Centre.

Interest payments on the AZN 50 million (€25 million) one-year floating rate note reference the AZIR (the Azerbaijan Interbank Rate) index. The bond was lead-managed by ABB-İnvest İnvestment Company and Unicapital İnvestment Company. An application has been made for the bond to be listed on the Baku Stock Exchange.

The proceeds of the successful issuance will support the EBRD’s AZN lending in Azerbaijan.

AZIR was established by the Central Bank of Azerbaijan in May 2023 and modified in May 2025 with technical assistance from the EBRD, to provide a new money-market benchmark reflecting the average daily rate for one-day unsecured interbank transactions (often referred to as the “risk-free rate” or “RFR”). It supports effective liquidity management by Azerbaijan’s domestic banking sector and provides the central bank with an important indicator for monitoring monetary policy transmission.

AZIR simplifies the calculation of interest payments for financial instruments and its introduction follows the launch of RFRs in other countries, including in the United Kingdom and the United States of America.

The policy dialogue that culminated with this issuance began several years ago. Discussions highlighted the regulatory changes needed to strengthen Azerbaijan’s domestic capital market. This milestone launch was made possible by strong backing from the Central Bank of Azerbaijan and the close involvement of the Baku Stock Exchange and the National Depository Centre.

The EBRD is the largest institutional investor in Azerbaijan. The Bank has invested over €3.6 billion in Azerbaijan across 200 projects in sectors including renewables, connectivity and sustainable infrastructure.