ARMENPRESS

EBRD EXTENDS CREDIT TO ARARATBANK IN ARMENIA TO
PROMOTE MSME FINANCING AND TRADE

YEREVAN, DECEMBER 29, ARMENPRESS; The European Bank
for Reconstruction and Development (ABRD) said it is
extending a USD 5 million credit line and a USD 1
million limit under its Trade Facilitation Program to
Araratbank, a privately-owned Armenian bank set up in
1991.
It said the financial package will be complemented
by a technical cooperation grant for institution
building.
The loan, which comes under the Armenian Multi-Bank
Framework II, will be provided to Araratbank for
on-lending to micro, small and medium-sized
enterprises, thereby addressing a major constraint for
economic growth.
Despite strong growth in recent years, Armenia’s
economic potential remains constrained by difficulties
in access to medium and long term finance.
The trade finance limit will allow Araratbank to
roll out its trade finance operations and to start
offering these products to clients.
Armenian banks still have very limited access to
the international trade finance markets. The EBRD
financing to Araratbank will also allow for more
competition among local banks and more choice for
local customers, EBRD said.
Michael Weinstein, Head of the EBRD Resident Office
in Yerevan, said the EBRD funding will allow
Araratbank to significantly expand its longer term
lending activities, particularly in the country’s
regions.
`This is a very important contribution to the
growth of Armenia’s enterprise sector as at present
the local banking sector does not deliver finance to
micro and small enterprises on a large and sustainable
basis’, he added.
Ashot Osipyan, CEO of Araratbank, stated: `We are
very glad that the EBRD continues its cooperation with
our bank, which is the most dynamically developing
bank in the country. We are confident that the
agreement will contribute to the fulfillment of our
strategic plans. Araratbank holds a stable position in
Armenia’s banking system and we are aiming to reach
the leading position in the future.’
The Armenian Multi-Bank Framework, launched in
March 2006, aims to support the increase of financial
intermediation of Armenian banking system and bolster
economic growth by making much needed medium-term
funding available to micro and small businesses
through credit lines to selected Armenian commercial
banks. The EBRD works with most of the leading local
banks, however this is the first project with
Araratbank.