UBA FORECASTS 10% DECLINE IN ARMENIAN BANKING SYSTEM IN 2009
Information-Analytic Agency NEWS.am
Aug 25 2009
Armenia
A 10% decline is expected in the Armenian banking system this year,
Chairman of the Union of Banks of Armenia (UBA) Emil Soghomonyan
told reporters. He assured the journalists that the country’s banking
system will register no decline next year. According to Soghomonyan,
16 of the 22 Armenian banks will close this year with profit, with
only six to sustain losses.
As regards the Russian stabilization loan, Soghomonyan refuted the
rumors that the Armenian Government is trying to save banks from
bankruptcy by distributing funds among them. According to him, this
is the most effective way of distributing funds, as they thus become
easier available to small and medium-sized enterprises (SME). Banks
issue credits to SME, as well as mortgage and car loans at annual
interest rates of 16 and up.
Soghomonyan also told reporters about reforms in the Armenian banking
system. He pointed out that much attention is being paid to the
value-added tax. The Government has submitted a package of reforms
to Parliament. In its turn, the Union of Bank of Armenia submitted a
17-point proposal. Reforms are expected in the real estate sector as
well — a single real estate registry is to be established. Soghomonyan
pointed out that outstanding loans have constituted 5-6 per cent this
year against 1% at the end of last year.