Saribek Sukiasyan: All the Banks Staying in the Market Will Have Excess Resources
Mr. Sukiasyan, the resolution of the Central Bank of Armenia, which sets a minimum regulatory capital of AMD 30 bn for Armenian banks is effective from 1 January 2017. Is ARMECONOMBANK able to meet this requirement?
Certainly, it will. Another distribution of ARMECONOMBANK's shares was complete on 25of October and the result will be submitted to the approval of the General Meeting of Shareholders in about a month, and then to the registration with the CBA. ARMECONOMBANK has distributed 145,000 shares at AMD 14.600 per share. After the registration of the results of the distribution by the CBA, ARMECONOMBANK's regulatory capital will amount to AMD 31 bn, hence we can already state that the Bank's regulatory capital is in compliance with the aforementioned requirement.
Lately, there have been a lot of complaints related to the high interest rates of loans. Do you see any possibility of reduction for these rates?
Such kind of discontent has been voiced earlier, too. People usually compare the average interest rates applied in Armenia and, for example, in the Western countries where these rates are lower. We understand their dissatisfaction, since the loans with lower interest rates and deposits with higher interest rates are the most attractive for customers. However, the interest rates of loans and deposits are directly interrelated, and if the Banks reduce the interest rate for their loans, the interest rates for deposits will decline as well.
I believe that 2017 will open a new page in the history of the Armenian banking sector, since that is when the real competition of the banks will start. All the banks staying in the market will have excess resources and will try to attract as many customers as possible.
With free resources available, it is natural that the interest rates on deposits may decrease. Yet, we should also consider that the Armenian banking sector pays nearly AMD 150 bn interest to depositors per year. This is a significant amount which also means that thousands of people are indirectly engaged in business, that is they gain income on placed deposits and pay income tax.
Mrs. Sukiasyan, recently there were media publications claiming that the Central Bank of Armenia forces the commercial banks to transfer their employees' accumulative amounts to pension funds. Are these claims credible, and has ARMECONOMBANK encountered such an issue?
''I find such publications baseless. The Central Bank of Armenia is a supervisory authority, I can assure you that there have never been any compulsions against ARMECONOMBANK OJSC related to this or any other matter. Yes, the Bank remunerates its employees, but the employees are free in their choices of savings management, while the Bank merely acts as their tax agent.
2016 is not over yet, but as stated by many, it was a rather hard year for the Armenian banking sector. How was it for ARMECONOMBANK?
Attempting to sum up this year, I would like to mention that we have invested a great deal of energy and resources. ARMECONOMBANK OJSC has expanded significantly, and now we have 47 branches against 40 we had in the beginning of the year. We have achieved growth of all main indicators, and the scope of the partnership has expanded significantly
In 2016, the Bank's equity increased on the account of share emission, consolidation, and investments made by our family as we managed to meet the Central Bank's AMD 30 bn regulatory capital requirement.
And the last question: How is the cooperation between ARMECONOMBANK OJSC and international financial institutions progressing?
As before, the Bank has been closely cooperating with its traditional partner and shareholder, the European Bank for Reconstruction and Development. In 2016, the Bank attracted USD 34 mln from overseas funds such as Symbiotics S.A., BlueOrchard Finance S.A., Incofin Investment Management, of which USD 24 mln was directed to the financing of small and medium businesses. Also, ARMECONOMBANK attracted more than AMD 1.7 bn through the Armenian Central Bank's project from the funds sources managed by the German-Armenian fund of KfW and other sources, the bulk of which was directed to the development of micro, small, and medium businesses.
Currently, we are negotiating on further attractions, and I hope that we will have a larger volume of attracted funds by the end of the year..
ARMECONOMBANK has always been a steadily developing bank with new attractive offers available to its customers, and our interests always meet.
Videos
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'Mr. President, It Is Now in Your Power to Right Decades of Denial' - US Congressman Adam Schiff Urges Joe Biden to Recognize Armenian Genocide
Armenians of Nagorno-Karabakh in Despair After Trauma of Military Defeat - France 24
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There is a solid evidence that Azerbaijan has launched a thoroughly planned attack on the NKR
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- 12:56 • 12.10.20 Zohrab Mnatsakanyan: Ceasefire Does not Mandate Azerbaijan to Kill Civilians and Hit Civilian Settlements
- 12:23 • 12.10.20 Armenians Protest Outside Turkrish Embassy in Los Angeles
- 17:23 • 09.10.20 Losses in Azerbaijan's Military Featured in Defense Army Footage
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- 14:11 • 09.10.20 Turkey openly backs Azerbaijan 'far more aggressively than in the past' - ABC News on Syrian mercenaries fighting in Karabakh
- 15:52 • 08.10.20 Iconic Armenian Church Hit in Azerbaijani Attacks in Nagorno-Karabakh City (photos)
- 10:57 • 08.10.20 Artsakh Defense Army Continues High-Precision Strikes
- 14:24 • 07.10.20 War Situation in Karabakh on European Parliament's Agenda
- 19:31 • 05.10.20 Call for Urgent Action: Armenian Journalist Brings Intn'l Colleagues' Attention to Situation iin Artsakh After Azerbaijani Attacks
- 16:17 • 04.10.20 Turkey's Support to Syrian Mercenaries Fighting Against Artsakh: Facts About Azerbaijani Aggression
- 12:39 • 04.10.20 Nagorno-Karabakh's Capital Under Azerbaijani Strikes
- 13:49 • 03.10.20 Armenian Armed Forces Neutralize Azerbaijani Defense Positions
- 10:12 • 29.09.20 ArmenianTroops Destroy Azerbaijani Armored Fighting Vehicle on Frontline
- 23:42 • 28.09.20 There is a solid evidence that Azerbaijan has launched a thoroughly planned attack on the NKR
- 18:45 • 28.09.20 EU calls for Immediate End to Hostilities over Nagorno-Karabakh
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