EBRD signs loan agreement with ARARATBANK for $ 10 million to promote women`s entrepreneurship and SMEs

ArmInfo. The European Bank for Reconstruction and Development (EBRD) provided 2 loans to ARARATBANK in national currency, the total amount of which is equivalent to $ 10 million. The signing of the respective loan agreement between ARARATBANK and EBRD took place on September 4. The program, in addition to funding, also provides for the final beneficiaries technical support, counseling, assistance in risk management and professional retraining of women entrepreneurs.  Executive Director of ARARATBANK Ashot Osipyan noted that loans will be provided at an interest rate of 11% per annum with a maturity of up to 5 years. These funds, he said, will allow the bank to meet the growing demand for financing from the side of women entrepreneurs and representatives of micro, small and medium-sized businesses that have developed activities in rural areas.

In this regard, he stressed that the bank has already submitted loan applications from women entrepreneurs for a total of 270 million drams. "I appreciate the relations with the EBRD and I am glad to announce that this year, ARARATBANK's cooperation with the EBRD turns 10. For this time we managed to attract over 120 million loan funds that were used to finance various sectors of the economy and contributed to the growth of Armenia's GDP. At the same time, thanks to this cooperation, we succeeded in introducing the best international banking technologies that have enabled ARARATBANK to become one of the leading banks in the country, to have competitive advantages in the market and to be recognized as the best from the side of international partners, "A. Osipyan said.

Noting that women entrepreneurs and SMEs have always been in the center of attention of ARARATBANK. Osipyan added that the program opens new opportunities for supporting business and creating additional values in the economy. We started with the Asian Development Bank (ADB) the first experience in financing women entrepreneurs, which means that women are more responsible borrowers - the loan portfolio of the bank did not have any problems related to repayment of loans of women entrepreneurs, he stressed. Soma Chakrabarti, Chairman of the Board of Directors of EBRD, who arrived in Armenia on an official visit, said: "We are happy to continue our successful cooperation with ARARATBANK. This deal underscores the mission of the bank - to promote the development of private business throughout Armenia and to stimulate women's entrepreneurship. I am sure that this credit line, as well as additional counseling, and non-financial assistance will help women expand and raise their business.

                "Speaking about the economic situation in Armenia, the head of the EBRD attached importance not only to financing, but also to the technical assistance provided by the Bank." EBRD experts support the modernization of the Armenian legislation, development of the capital market, strengthening of cooperation in the format of private-state partnership. The EBRD intends to assist Armenia in increasing the attractiveness of the business environment for attracting both domestic and foreign investments. "There is much more to do in Armenia. Nevertheless, I should note that the Armenian government implemented significant steps in this direction ", - stated S.  Chakrabarti.

                It should be noted that the women's business is supported by the EBRD program Women in Business, which includes the countries of the European Eastern Neighborhood - Armenia, Ukraine, Georgia, Belarus, Azerbaijan and Moldova. EBRD has successfully implemented assistance programs in 25 countries. With the help of these funds, local banks issue loans on affordable terms, in addition, women entrepreneurs are provided with business consulting and retraining services. Since its inception in Armenia since 1992, the EBRD has implemented 188 programs in the financial, corporate, infrastructure and energy sectors, investing 1.11 billion euros, of which 88% are in the private sector.

                According to the Financial Rating of Armenian Banks, prepared by IA ArmInfo on July 1, 2017, ARARATBANK takes the third position in terms of annual growth of SME crediting - 38.7%, and in absolute terms - 6th position - 46bln AMD. In the total loan portfolio of ARARATBANK, the share of SME lending reaches 37.6%. In the total credit investments of banks in the SME sector, the share of ARARATBANK increased in the annual section from 5.6% to 7.5%. The majority shareholders of ARARATBANK on July 1 this year are: one of the largest oil traders in Armenia - Flush company - 72.73%, EBRD - 18.14%, Rural Impulse Fund II (included in the structure of the Belgian Incofin Investment Management - Incofin IM) - 8.58%.  ARARATBANK takes the third position in the total number of branches, of which there are 60, and this position is held by the number of regional branches (29), and the number of capital (29) is fixed. OJSC "ARARATBANK" is  operating since November 2005.