EBRD TO GRANT $5 MLN TO ‘CASCADE BANK’ FOR CREDITING OF SMALL AND MIDDLE BUSINESS IN ARMENIA
arminfo
2008-03-17 14:05:00
ArmInfo. The European Bank for Development and Reconstruction (EBRD)
will grant $5 mln to "Cascade Bank" for crediting of a small and
middle business of Armenia. As the press service of "Cascade Bank"
told ArmInfo, participation in EBRD’s programme will allow the bank
to extend the credit activity, especially as regards promotion of
a small and middle business, which is considered by the bank as a
sphere of strategic growth. In addition to the credit, the bank will
be rendered technical assistance. The agreement on it was signed today.
Head of the EBRD Yerevan Office Michael Weinstein thinks that financing
by the European Bank will allow to assist in the development of a
small and middle business as the own resources of the country’s banking
system are insufficient as yet. "This sphere is important by the fact
that workplaces are created just here, the social level increases
and the average class is formed", he said. Chairman of the Board of
"Cascade Bank" Jonathan Stark emphasized that the credit line will
more toughen the relations of the "Cascade Capital" financial Holding
with EBRD and will allow the bank to extend credits to the people at
large on more available terms. For his part, Executive Director of
the "Cascade Bank" Aharon Levonyan said that, taking into account
the tendency of the deposit rates increase in Armenia, the EBRD’s
credit line comes out an important alternative source of financing,
which will enable the bank to continue crediting of a small and middle
business at lower interest rates.
According to ArmInfo data, Armeconombank, ACBA-Credit Agricole Bank,
INECOBANK and "Anelik Bank" appear as participants in EBRD’s programme
on crediting of a small and middle business.
By the data of RA Central Bank, as of July 1, 2007, the banks and
credit companies extended credits to 103,4 bln drams ($303,4 mln)
for development of a small and middle business (taking into account
the international credit programmes), with assurance of 36% annual
growth. 57,2 bln AMD out of this sum fall on the dram assets and 46,2
bln AMD – on currency ones. 22,1 bln AMD are credits with repayment
term to 1 year, and 81,3 bln AMD – with repayment term of 1 year and
more. Moreover, 30% of credits, directed to this sphere, falls on the
international credit programmes, which played a definite positive
role in creation of the banks’ resource base, that enables them to
pass to refinancing of different spheres of economy at the expense
of the own capital. As the analyst of the Rating Agency AmRating
Karina Melikyan said, half of 20 programmes, implemented in Armenia
through the banks, is aimed at assistance in development of a small and
middle business, including farm enterprises. She thinks that special
attention to this sector was initially paid because of high demand
for preferential credits by small and middle economic entities –
industrial enterprises, trade companies, agricultural enterprises
and those of the service area.
To note, 35% of the block of stock of the "Cascade Insurance",
being part of the "Cascade Capital Holding" (CCH) belongs to the
European Bank. CCH also includes the Cascade Bank, Credit Company
"Cascade Credit", capital management Company "Cascade Equity Managers"
and Investment Company "Cascade Investments". The "Cascade Capital
Holding" belongs to the "Gafeschyan Family" Fund, registered in the
USA. The "Cascade Bank" has won an exclusive right for service of the
USA State Department’s programme "Millennium Challenges". Moreover,
it is one of the participants in the international credit programme
of KfW on development of stable housing financing market of Armenia.
According to the data of Ranking of RA commercial banks, prepared
by the Agency of Rating Marketing Information (ArmInfo), the volume
of credit investments of the "Cascade Bank" as of January 1, 2008,
made up 4.7 bln drams or over 18% of assets. About 60% out of this
sum has been directed at crediting of natural persons and 34% fell
on the credits directed to the country’s economy.
From: Emil Lazarian | Ararat NewsPress
