Wednesday, April 10 2013 21:58

Reduction in reserve requirement would allow Armenian banks to increase their loan books without intensive capitalization


ArmInfo. The Central Bank of Armenia should reduce its 12% reserve requirement (3% in foreign exchange and 9% in AMD), Director General of VTB Bank (Armenia) Yuri Gusev said during a press- conference on Wednesday in response to ArmInfo's question.

"This would allow the banks to increase their loan books without intensive capitalization and would encourage the players to appear with new initiatives for developing the economy," Gusev said.

When asked by ArmInfo if the country's banking laws help the banks to developing their financial instruments, Gusev said that the key problem for the country's banking system is not the laws but the judiciary.

Vice President of VTB24 Vsevolod Smakov said that Armenia's banking system is one of the most stable in the CIS. "This means that the country's banking laws meet the requirements of the sector," Smakov said.

On Feb 8 2011 the Central Bank of Armenia toughened the reserve requirement for the Armenian banks, fixing it at 12% (3% in foreign exchange and 9% in AMD against 6% and 6% formerly).
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