The World Bank Report No: ISR14496 Implementation Status & Results Azerbaijan Capital Markets Modernization Project (P120321) Public Disclosure Copy Operation Name: Capital Markets Modernization Project (P120321) Project Stage: Implementation Seq.No: 6 Status: ARCHIVED Archive Date: 11-Jun-2014 Country: Azerbaijan Approval FY: 2011 Product Line: IBRD/IDA Region: EUROPE AND CENTRAL ASIA Lending Instrument: Technical Assistance Loan Implementing Agency(ies): Azerbaijan State Committee for Securities Key Dates Board Approval Date 17-Mar-2011 Original Closing Date 31-Dec-2015 Planned Mid Term Review Date 20-Jan-2014 Last Archived ISR Date 24-Oct-2013 Effectiveness Date 07-Nov-2011 Revised Closing Date 31-Dec-2015 Actual Mid Term Review Date 03-Feb-2014 Project Development Objectives Project Development Objective (from Project Appraisal Document) Increase the use of equity and corporate debt as financing and/or investment instruments through the adoption of an effective capital markets regulatory framework and infrastructure. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Component 1: Streamlining and Automating Market Infrastructure. 6.00 Component 2: Updating and Strengthening the Legal and Regulatory Framework. 1.90 Component 3: Stimulating Supply. 1.80 Component 4: Capacity Building 3.90 Overall Ratings Public Disclosure Copy Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial Implementation Status Overview The State Committee for Securities (SCS) is progressing towards the CMMP’s benchmarks and goals. However delays in implementation of several activities require increased efforts to ensure an overall timely implementation progress. The single main consultancy assignment for USD 8.4 million was launched in September 2012 and contract implementation is satisfactory. The procurement process for capital market trading and settlement infrastructure has been initiated. Page 1 of 5 The World Bank Report No: ISR14496 Locations No Location data has been entered Public Disclosure Copy Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Increased issuance of corporate bonds Percentage Value 1.90 4.10 3.80 Date 15-May-2011 31-Dec-2013 Comments The ratio of corporate debt to non-oil GDP at 4.1% is ahead of schedule, due to an overall net increase in the amount of corporatebonds outstanding. Increased number of companies with listed Number Value 2.00 1.00 8.00 equity (accumulative) Date 15-May-2011 31-Dec-2013 Comments The “number of listed equity securities” has shrunk from 2 to 1 as one of the listed company did not fulfill the requirements, hence was de- listed. The launch of Listing Advisory Program will help increasing listings. Improved price transparency Percentage Value 0.00 0.00 90.00 Date 15-May-2011 31-Dec-2013 Comments The progress on this indicator remains flat. However, upon implementation of CMIS, this indicator will show progress Public Disclosure Copy Intermediate Results Indicators Page 2 of 5 The World Bank Report No: ISR14496 Indicator Name Core Unit of Measure Baseline Current End Target Ratio of market participants electronically Percentage Value 0.00 100.00 100.00 linked to market infrastructure (trading, clearing Date 15-May-2011 31-Dec-2013 Public Disclosure Copy and settlements) Comments Electronic access by market participants has been fully achieved, with a 100% tie-in. The new IT system to be acquired under Component #1 will only need to continue this feature. Enactment of a new Capital Market Act Text Value No No Yes Date 15-May-2011 31-Dec-2013 Comments The draft law and conforming amendments to civil code has been submitted to Presidential administration. It is expected that the law will be adopted by Parliament by September 2014 Promulgation of capital markets regulation Text Value No No Yes required upon enactment of Law Date 15-May-2011 30-Sep-2013 Comments The full package of implementing regulations are expected to be finalized in the 2nd quarter of 2014 so that the regulations can beadopted shortly after enactment of Law Number of companies involved in the listing Number Value 0.00 1.00 15.00 advisory program (debt and equity) Date 15-May-2011 31-Dec-2013 Comments The number of companies Public Disclosure Copy enrolled in the Listing Advisory Program is stagnant. With the launch of Listing Advisory program in April 2014, this indicator will start to show progress Page 3 of 5 The World Bank Report No: ISR14496 Increased of the threshold pass rate of the Percentage Value 50.00 75.00 75.00 Financial Certification examination for market Date 15-May-2011 31-Dec-2013 participants Comments The “increased threshold of Public Disclosure Copy the pass rate for professional certification” is within the authority of the SCS. And, it has been raising the rate as planned. Consumer Awareness of Capital Market Number Value 24.00 36.00 45.00 Instruments Date 15-May-2011 31-Dec-2013 Comments Consumer awareness of capital markets instruments is improving almost to the expected time line Data on Financial Performance (as of 15-May-2014) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P120321 IBRD-80240 Effective 17-Mar-2011 22-Sep-2011 07-Nov-2011 31-Dec-2015 31-Dec-2015 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P120321 IBRD-80240 Effective USD 12.00 12.00 0.00 4.27 7.73 36.00 Disbursement Graph Public Disclosure Copy Page 4 of 5 The World Bank Report No: ISR14496 Public Disclosure Copy Key Decisions Regarding Implementation None Restructuring History There has been no restructuring to date. Related Projects There are no related projects. Public Disclosure Copy Page 5 of 5