ARMENIAN BANKS DAILY LOSS 4.7BLN AMD AFTER FLOATING RATE SET

ARKA
Apr 9, 2009

YEREVAN, April 9. /ARKA/. The CBA’s return to a floating rate policy
caused 4.7bln AMD losses to the Armenian banks on March 3 alone,
Chairman of the Central Bank of Armenia (CBA) Artur Javadyan told
reporters at the international press center Novosti.

On March 3, the Central Bank of Armenia (CBA) announced a return to a
floating rate policy. As a result, 66.36% AMD depreciation against the
USD was recorded as compared with March 2. The exchange rate between
the AMD and USD was 372.11 AMD/$1 on March 3. CBA experts say that
the average exchange rate will range between 360-380 AMD/$1 during
this year.

"The exchange adjustments created an unfavorable situation for Armenian
banks mostly had short foreign exchange positions," Javadyan said.

According to him, the panic observed in the country since last December
caused this behavior on the part of banks.

"Most depositors converted their AMD accounts into USD ones, which
disturbed the balance between the banks’ assets and credits issued
by them," Javadyan said.