Tuesday, June 14 2011 20:08
IFC helps Armenian Bank improve risk management with innovative financial products
ArmInfo. IFC, a member of the World Bank Group, and Armenia's ACBA-Credit Agricole Bank signed an International Swaps and Derivatives Association master agreement, which will support ACBA-Credit Agricole to better manage its currency and interest-rate risks, and help improve its competitiveness and profitability.
Under the agreement, IFC will provide ACBA-Credit Agricole Bank with U.S. dollar interest-rate swaps and foreign currency swaps. This will enable the bank to mitigate its interest-rate risks on borrowed funds as well as currency risks for its euro deposit base, and allow it to provide a wider range of deposit products to customers.
The agreement is part of IFC's strategy aimed at introducing innovative products to its clients in Europe and Central Asia to enhance their ability to control risk.
"This transaction will help strengthen our risk-management capacity, which is particularly important in the post-crisis period," said Stepan Gishyan, CEO of ACBA-Credit Agricole Bank.
Thomas Lubeck, IFC Regional Head of the Caucasus, said, "This innovative tool will support ACBA-Credit Agricole Bank, a reliable partner in Armenia helping lead the post-crisis recovery. It is an example of the high value-added services that IFC can offer to its clients."
IFC partnered with ACBA-Credit Agricole Bank in 2003 to establish ACBA Leasing, the first leasing company in Armenia. In March 2011, IFC provided a $20 million loan to ACBA-Credit Agricole Bank, enabling the bank to expand lending to micro, small, and medium enterprises.
Since Armenia became a member of IFC in 1995, IFC has invested $110 million in 24 projects across industries, including financial markets, general manufacturing, and mining. IFC Advisory Services provides advice through projects focusing on the financial sector, sustainable energy, and investment climate regulatory simplification.
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in developing countries. We create opportunity for people to escape poverty and improve their lives. We do so by providing financing to help businesses employ more people and supply essential services, by mobilizing capital from others, and by delivering advisory services to ensure sustainable development. In a time of global economic uncertainty, our new investments climbed to a record $18 billion in fiscal 2010. For more information, visit www.ifc.org.
ACBA-Credit Agricole Bank was established in 1995 in the scope of EU's TACIS project. In 2006 Credit Agricole became its largest shareholder by investing significant financial contributions. The Bank is highly ranked both in Armenia and on the international financial market due to its financial stability and reliability. It is a key player in the Armenian banking system and ranked first in terms of total assets, loans, capital, as well as implementation and development of innovative technologies. As of March 2011, ACBA had total assets of $459 million, a loan portfolio of $295 million and a capital of $109 million. For more information, visit www.acba.am.
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