The State Savings Bank of Tajikistan “Amonatbank” is planned to be renamed into the State Unitary Enterprise “Savings Bank of the Republic of Tajikistan “Amonatbank”.
This decision was made on February 28 at a regular meeting of the country’s government, the press service of the head of state reports.
The report says that a decision was also made to create a Board of Supervisors of the newly formed State Unitary Enterprise and introduce the principles of corporate governance in Amonatbank.The need for such innovations is explained by “ensuring control and transparency of the financial and economic activities” of the enterprise.
Note that a unitary enterprise is a form of management in which a commercial organization does not have the right of ownership to the property assigned to it by the owner.
The owner of “Amonatbank” at present, according to the data of the National Bank of the country, is the government of the country.
Currently, “Amonatbank” is registered in the register of the National Bank of the country as the State Savings Bank of Tajikistan, the specific form of management (JSC, CJSC, OJSC) of the bank, unlike other banks in the country, is not indicated in this register.
The predominant share of shareholders in banks is indicated in this register as a percentage. In “Amonatbank” the owner of 100%, according to the register, is the Ministry of Finance of the Republic.
Typically, unitary enterprises are regarded as a less transparent form of management compared to joint-stock companies due to the lack of corporate governance in the former.
However, in the case of Amonatbank, as noted above, it is planned to introduce the foundations of such management.
At the end of 2021, international financial institutions proposed to the government of Tajikistan to create a joint-stock company on the basis of Amonatbank, with the subsequent transfer of a controlling stake to private hands. The head of “Amonatbank” Sirojiddin Ikromi said at the beginning of last year that such issues are decided by the government of the republic.
After the bankruptcy of the two once largest banks in Tajikistan (Agroinvestbank and Tajiksodirotbank), Amonatbank occupies a leading position in the country’s financial intermediation market.
In the list of backbone credit organizations of Tajikistan for the current year, “Amonatbank” is on the first line. The bank’s net profit in 2022 amounted to almost 102 million somoni (about $9 million), which is 53.5% more than in 2021.
Advantages and disadvantages of unitary enterprises
A unitary enterprise (UE) is a commercial organization. He has property, but he cannot own it. The owner and founder is the state, which transfers property to the unitary enterprise on the basis of the rights of operational management or business activities.The word “unitary” is borrowed from the Latin ūnitās, which means “single, indivisible” – property cannot be divided into shares, shares or contributions, it is owned by one owner.
The advantages include the following:
– solve important socially significant issues;
– operate under the protection of state or municipal authorities;
– can count on financial support from the state – grants, subsidies, etc.;
– have a minimal risk of bankruptcy, since the owner will make every effort to prevent this from happening;
– have the right to receive profit at the expense of the property transferred for management;
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– are in a better position when conducting procurement procedures, since contracts to meet the needs of the state have a rigid framework and cut off unsuitable candidates;
– quite often act as the only player in the provision of services to the population.
Among the shortcomings can be identified:
– strict supervision of activities from higher authorities;
– multi-stage and protracted approval process when concluding major contracts;
– the need to coordinate any reorganization issues with the owner of the property;
– the need to send a significant part of the profits to the state budget;
Source: Asia Plus