ArmInfo. On September 27, Armenian Prime Minister Karen Karapetyan chaired a consultative meeting, attended by banking sector representatives, the press office of the Armenian Government reports
The Prime Minister stressed the importance of the meeting and noted that he is expecting proposals containing practical and innovative solutions that would accelerate the improvement of the business environment and would attract investment.
"Our goal is to come aware of the existing problems and challenges in order to understand what the financial and economic system is expecting from the Government. Our goal is to make sure that business breathes easily. In this regard, I expect you to submit proposals as to what specific measures we need to take to provide additional lending for the economy. It is time to suggest practical solutions," Karen Karapetyan noted.
The Prime Minister invited the banking system representatives to develop appropriate mechanisms for SME lending using the assets available with the banks in order to activate individual sectors of the economy.
Central Bank Chairman Artur Javadyan presented the monetary policy, as well as the overall situation in the sphere of economic lending.
Summing up the meeting results, the Head of Government instructed the ministers in charge of the financial and economic bloc to discuss the proposals and continue working closely with the banking system representatives in an effort to address the issues raised and implement various programs in the specific fields.
According to ArmInfo's Financial Rating of Armenian Banks, at present there are 19 banks in Armenia. As of 1 July 2016, the banks' aggregate total capital was 582.6 bln AMD, assets - 3.5 trillion AMD, with 67.6% or 2.4 trillion AMD of this amount being provision of crediting. Lending to economy sectors totaled 1.5 trillion AMD. The share of SME lending the loan book of the banking system was about 27%, or 605 bln AMD (with a 12% year-over-year growth). The revenues from lending grew by 4% over year, while the expenditures on deposits increased by almost 20%. The share of NPLs in the loan book exceeds 13%, while the international critical range is 10-15%, and the absolute value of NPLs grew by 37% over year, concentrating mostly in trade, industry, agriculture, and construction. In H1 2016, the banking system's profit amounted to 12.4 bln AMD, including 9.3 bln AMD in Q2 2016 alone.