The International Bank of Azerbaijan, the country's largest lender, has doubled its authorised capital to AZN1.24bn (€640mn) through the issuance of shares on the domestic stock exchange, topnews.az reported on January 16.

IBA's fate has been chequered in recent years. In March 2015, the giant bank, which accounts for over a third of banking assets in the country and has subsidiaries in a dozen others, fell in thrall to the biggest corruption scandal in the country marked by questionable lending practices and an ill-thought-out lending strategy. Its long-serving chairman at the time, Jahangir Hajiyev, was placed under arrest - under which he remains - and scores of top management were dismissed or detained.

The country's financial markets regulator took over the lender, seeking to purchase its skyrocketing bad assets through a state-owned non-credit agency. Initially, Baku denied rumours that IBA's non-performing loans had reached AZN10bn (€5.42bn), or almost its entire loan portfolio at end-2015, which stood at AZN10.5bn. Instead, it claimed that the government would only spend some AZN3bn on bailing out the troubled lender.

However, in November 2016, ratings agency Fitch Ratings downgraded the bank's viability rating from 'b-' to 'f' after receiving confirmation that authorities had indeed spent AZN10bn on rehabilitating the lender. In Fitch's view, the downgrade amounted to a recognition of the fact that the bank had failed.

''This capital increase is our next step towards a successful recovery of the IBA,'' Khalid Ahadov, IBA's new chairman of the board, reportedly said.