ACBA-Credit Agricole Bank Head: Armenian Banks Face No Threat Of Col

ACBA-CREDIT AGRICOLE BANK HEAD: ARMENIAN BANKS FACE NO THREAT OF COLLAPSE

ARKA
June 17, 2009

YEREVAN, June 17. /ARKA/. Stepan Gishyan, general executive director
of ACBA-Credit Agricole Bank, finds collapse of Armenian banks very
unlikely.

In his interview with ARKA News Agency, he said that the country’s
banks are "in far better state than many of their counterparts
in Europe".

In his opinion, Armenian banking system is stable and has no liquidity
problems.

"The global crisis brought no deficit liquidity to the country. We
have plenty of liquidity instead, and we don’t know what to do with
the money there is solvent demand shortage is seen in the real sector",
Gishyan said.

Commenting on non-standard and doubtful credits that have grown from
1% to 7% in banks’ credit portfolios over the first quarter of 2009,
the banker said that it doesn’t show their insolvency, since it is
possible to make up losses later this year.

However, Gishyan admits that things worsened now, compared with the
previous year, because of the crisis.

He thinks banks should merge to build up their competitiveness.

But he is opposed to compulsory mergers.

Gishyan welcomes voluntary merger. In his words, nobody intends to
force banks.

World experience shows that market points out the necessity of merger,
he said.

"Time will come soon for the same things here", Gishya n said.

"Small banks in Armenia will merge to survive."

ACBA-Credit Agricole Bank (former Agricultural Cooperative Bank of
Armenia) was established in 1995 and registered on March 29, 1996.

The bank was established as part of RU TACIS program.

Key shareholders are French Credit Agricole S.A. (16%), French "SACAM
International" (2.44%) and agricultural cooperative unions in Armenia’s
provinces.