Associated Press Worldstream
March 24, 2004 Wednesday

Russia’s state-owned Vneshtorgbank buys controlling stake in Armenian
bank

Russia’s state-owned Vneshtorgbank on Wednesday bought 70 percent of
the shares in a major Armenian bank, officials said.

Andrei Kostin, board chairman of Vneshtorgbank, said that the
purchase of a controlling stake in Armenia’s Armsberbank marked the
Russian bank’s first acquisition of another bank in the former Soviet
Union.

He called it recognition of Armenia’s political and economic
stability.

Russian state-owned companies have increasingly tightened their
foothold in this ex-Soviet republic. Russia’s giant energy monopoly
assumed financial control of Armenia’s only nuclear plant last year
in a deal that Armenia sought to get out from under massive energy
debts to Russian fuel suppliers.

Armenia also depends on Russia’s Gazprom for natural gas supplies,
and Russian businesses are reportedly eying other sectors of the
Armenian economy.

Kostin said that Vneshtorgbank, which is 99.9 percent state-owned,
planned to use its investment to provide “the whole spectrum of
services to Russian companies operating in Armenia.” He also said
that it was considering a significant increase of Armsberbank’s
capital.

Armsberbank was created in 1923 and privatized in 2001.

Two other Armenian banks, Areksimbank and Yunibank, also have Russian
investors.