Friday, July 1 2011 10:38
Samvel Chzmachyan: Our expectations depend on situation around banking system
ArmInfo. Interview with Chairman of Anelik Bank Board Samvel Chzmachyan
Mr. Chzmachyan, first, I'd like to congratulate you on opening of the new head office. When do you plan to fully move to the new building?
Thank you. Actually, part of our staff moved to the new head office in Vardanants Street yet two month ago. The other part is working in the former address in Baghramyan Street 75 waiting for completion of the repair of their future premises occupying 500sq/m out of total 3500sq/m in the new building. The facade of the new building was preserved, while the interior was modernized fully. I am boast of the fact that part of design ideas belongs to me.
With the new Lebanese shareholder joining Anelik Bank you have not only changed your head office but also significantly raised the key figures despite the crisis. What are the bank's key figures and expectations now?
Actually, before the Lebanese Bank's entering our capital, it was $15 mln, whereas now it exceeds $41 mln. It was in the period of crisis and they years 2011-2013 are post-crisis recovery period for the baking system in general. I think that starting mid-2013 a serious growth will be observed at banks if nothing extraordinary happens in the world. As for our expectations, they depend mostly on the situation around the banking system that holds us and other banks from operating at full capacity. Nevertheless, if our loan portfolio in 2010 totaled 29 bln drams, we will increase it to 41 bln drams till the end of the year. Now, our loan portfolio has already reached 37 bln drams and comprises equal shares of AMD and USD loans. One of our strategic tasks is to reduce the share of big loans to boost SME financing. Loans to SME are provided on more favorable rates for banks than loans to big business. Raising funds at 12%-13% annual interest and on-lending at 9%-10% is absurd. It means that the banking system works for others.
At the same time Anelik Bank intends to increase assets to 70-71 bln AMD by late 2011, and upon completion of 2011 to obtain a profit of 800 mln AMD, while in 2010 it was about 500 mln AMD.
It is not a secret that Anelik Bank has always participated in international financial programs. We will continue participating in such programs to increase our key figures. In particular, we expect a $9 mln loan as part of the credit programs signed with the EBRD in late 2010. In addition, we are negotiating with IFC, Asian Development Bank and EFSE (part of KfW -ed.) for new funds. If we manage to raise some $50 mln till the end of the year, it will be perfect.
Mr. Chzmachyan, Lebanese businessmen have been recently taking special interest in Armenia. Anleik Bank thanks to its Lebanese shareholder has also launched cooperation with Arab businessmen. Did you plan that yet before Credit Bank's entering the bank's capital?
Well, it can be explained by several factors. On the one hand, Lebanese market is the oldest financial and banking center in the world that is quite active also now. Maybe, it is because of the political situation and risks that the Lebanese try to invest their funds in aboard. So, why not in Armenia? The Lebanese Christians have quite common mentality with Armenians. There is a big Armenian Diaspora in Lebanon. The Lebanese are serious-minded but more cunning than Armenians. As regards Anelik Bank's entering the Arab markets, it is very difficult because of the conservativeness of the Arab banking system. It is too strong to need any changes. Nevertheless, our shareholders promise that we will enter Arab markets and then Chinese and Indian ones.
It market expansion the result of the Anelik money transfer system which is the exclusive advantage of the bank's activity?
It was the bank's advantage in the period from 1997 up to 2003, but it yielded to other services now. Anelik Bank is the only bank to owe a money transfer system in Armenia. There are also other well operating money transfer systems, for instance UNIStream, but it is not the property of an Armenian bank.
We plan a 20%-30% annual growth for private remittances to $1.3-$1.3 bln in 2011. The expected final recovery from the financial crisis creates prerequisites for a new ambitious indicators. Anelik money transfers alongside with remittances on other systems have fallen 40% since 2009. However, we plan to increase money transfers to $2 bln by 2012-2013 to reach the pre-crisis level of 2008.
At the same time, the share of transfers to Russia, Georgia, Uzbeksitan, Ukraine, Tajikistan on the Anelik system is the largest, while Armenia's share is only 10%.
Unlike other banks, Anelik Bank having long years of experience is not expanding the branch network however. Why?
All the 11 branches of the bank are located in various communities in Yerevan and the nearby big towns. We are a city bank and our agricultural loan portfolio is not big - some 500 mln drams. We can open an endless number of branches, but we more care for quality and not quantity. Our branches occupy 300-400sq/m premises in average, while calling a premise not larger than a vendor kiosk with three employees an office is not solid at least.
Thank you.
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