Thursday, December 9 2010 14:14

ARF Dashnaktiutyun: Armenian banking system is very much concentrated


ArmInfo. Armenian banking system is very much concentrated, which because of high investment risks in the country creates the risk of the banking capital outflow to abroad, ARF Dashnaktiutyun commented on social and economic policy of Armenia and state budget 2011, on 8 December. In particular, 17 out of the 21 functioning in the country banks are CJSC and one - LTD. The total of 66 individual and legal persons take part in their shareholder's capital, 34 of which are non-resident. Together they manage 92% of all the assets of the Armenian banking system (about 1418 bln drams) and the total banking capital (about 307 bln drams). In six banks one shareholder owns 100% of shares and in 10 - more than 50%.

ARFD thinks that the ratio of the banking capital and assets is evidence of the non-effective placement of financial resources. According to the results of the 3Q 2010, this ratio is 21,7%, whereas by the Stable Development Programme, endorsed by the Armenian government in October 2008, this indicator was planned to reach 11,1%. The difference between the rates on attracted deposits and delivered credits still remains high. Thus, the average rate on credits for a term up to one year reaches 178% of the average rate on dram deposits and 201% on US dollars deposits for legal persons. These figures are 230% and 219% respectively for individual persons.

"On the one hand, this is evidence of high level of risk in the economy of Armenia, and on the other hand, about the open aspiration of the banking system to high profits", - ARFD says.

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