GENERAL OBLIGATIONS OF ARMENIAN BANKING SYSTEM UP 33% TO $2.8 BLN IN 2009

ArmInfo
03.03.2010

ArmInfo. General obligations of the banking system of Armenia were up
33% in 2009 (versus 31% growth for 2008), 19.2% in the second half and
amounted to 1.1 trillion drams ($2.8 billion) on Dec 31. For Q4 alone
general obligations of the banking system of Armenia were up 6% versus
6.5% for Q4 2008. The share of time deposits in general obligations
was 40.8% on Dec 31 2009, and the share of call liabilities was 25.9%.

Deposits and loans provided by banks and other financial organizations
totaled 23.7% and bank correspondent accounts (loro) totaled 1.3%
of general obligations. These indicators amounted to 432 bln drams,
274.4 bln drams, 251.5 bln drams and 13.6 bln drams, respectively.

Analysis and Ranking of the Armenian Banking System prepared by the
Agency of Rating Marketing Information (ArmInfo) say time deposits grew
52.5% in 2009, call liabilities – 35.5%, bank correspondent accounts
(loro) – almost 42% and deposits and loans provided by the banks
and other financial organizations were up almost 60%. In Q4 alone,
time deposits grew 14%, call liabilities – 10%, whereas in Q4 2008
these indicators were up 0.4% and 14%, respectively. Deposits and
loans provided by the banks and other financial organizations grew 73%
and loro-accounts – 77% for Q4 2009. Dynamics of liability structure
shows that commercial banks raise funds both from the domestic and
external sources, as well as participate in international credit
programs, to maintain lending despite the crisis.

The deeper was the crisis the more intensively banks got involved in
international credit programs and raised long-term and inexpensive
funds to on-lend on favorable terms. It is noteworthy that the banks
involved in the WB SME support programs began funding the small and
medium-sized enterprises in late June 2009. Alongside with this,
the banks got an opportunity to maintain lending on the funds from
the Russian stabilization loan.

Call liabilities of 8 banks were down for Q4 2009, whereas the other
banks showed growth of call liabilities for the given period of time.

Call liabilities of the following banks suffered the most significant
decline for Q4: Ameriabank – 17.1% (the 10th position by the amount
of call liabilities), HSBC Bank Armenia – 11.2% (1st position), and
Ardshininvestbank – 11.1% (3rd position). BTA Bank Armenia showed
the highest quarterly growth – almost 3 times (22nd position). Call
liabilities of Cascade Bank suffered the most significant decline per
year – 30.2% (16th position) , whereas this indicator of ProCredit Bank
grew over two times per year (18th position). Top three of leaders of
the amount of call liabilities comprises HSBC Bank Armenia (65.4 bln
drams), Converse Bank (27.1 bln drams) and Ardshininvestbank (24.7
bln drams). Time deposits of the most of banks fell in Q2, whereas in
Q3-Q4 this indicator of only 5 banks suffered decline. The remaining 17
banks grew. Time deposits of only one bank suffered decline per year,
the remaining 21 banks ensured growth. The most significant decline
of time deposits for Q4 2009 was registered at ArmSwissbank – 21.1%
(17th position by the volume of time deposits). ARARATBANK ensured
the highest growth of this indicator for Q4 – over two times (11th
position). Anelik Bank proved the only bank to show annual decline of
time deposits – 6.9% (14th position). Ameriabank ensured the highest
growth of time deposits per year – almost 4 times (2nd position).

Top five of leaders by the volume of deposits were Unibank – 73.2 bln
drams, Ameriabank – 54.3 bln drams,Ardshininvestbank -51.9 bln drams,
HSBC Bank Armenia – 40.9 bln drams and ACBA Credit Agricole Bank –
33.5 bln drams. The share of these banks was nearly 60% of summary time
deposits of the Armenian banking system. The largest share of time
deposits placed with Unibank, Ardshininvestbank, HSBC Bank Armenia
and ACBA-Credit Agricole Bank belonged to individuals, whereas in
Ameriabank the share of deposits of legal entities was the largest.

HSBC Bank Armenia was the leader by the share of the call liabilities
in general obligations as of Dec 31 2009 – 55.1%. Byblos Bank Armenia
was the leader by the share of the time deposits in total – 80.2%
(15th position by the volume of time deposits). The annual dynamics
of changes in call liabilities and time deposits of ProCredit Bank is
available starting Feb 2008 when the bank entered the Armenian market.