ArmInfo. The process of de-dollarization of loan and deposit portfolios continues In the banking system of Armenia. According to the Central Bank of Armenia, by the end of 2019, the share of the currency and dram components in the total loan portfolio was almost equal - 50.1% against 49.9%, while in 2018 the difference in favor of the currency component was noticeable - 54.8% against 45.2%.
An increase in the share of dram deposits is also observed in the deposit portfolio, but foreign currency deposits, despite a slight decrease in the share, still prevail. Thus, according to the Central Bank, the share of the currency component in bank deposits decreased in 2019 from 60.4% to 57.6%, while the dram component increased from 39.6% to 42.4%.
In total, the total loan portfolio slowed down to 16.7% in 2019 from 17.2% in 2018, while the deposit portfolio, on the contrary, accelerated growth to 20.7% from 12.7% in 2018. Moreover, in the deposit portfolio, growth acceleration was observed both in dram and in foreign currency deposits. In case of dram deposits a more tangible acceleration of y-o-y rates is noticed- from 12.6% to 29.3%, compared to foreign currency ones - from 12.7% to 15 %. And in the loan portfolio, a modest increase in foreign currency loans in 2019 by 6.8% (against an increase of 3.2% in 2018) was accompanied by a slowdown in dram growth to 28.7% from 40.3% in 2018. In particular, in AMD lending, growth acceleration was recorded only in the construction sector (48.3%) and mortgage loans (56.1%), while in other sectors, lending growth slowed down, and in the field of transport and communication, significant decline was recorded ( 42.1%).
In foreign currency lending, the dynamics deteriorated only in the industrial sector (from 19.7% growth to 7.9% decline) and the transport and communications sector (growth slowdown from 45% to 5.7%), while in other sectors, there was a high increase, and in the agricultural sector and trade even with a way out of the recession. In the portfolio of borrowings, a significant increase in AMD term and demand deposits by 36.6% and 23.2%, respectively, was accompanied by a decrease in their foreign currency equivalents by 1.4% and 8.9%, respectively.
According to the CBA, the total volume of credit investments of Armenian banks as of Dec 31, 2019 amounted to 3.3 trillion drams, of which 12.1% were placed in the commercial sector and 11.7% in the industrial sector. The total volume of deposits as of this date amounted to 3.7 trillion drams, of which over 1.7 trillion are term deposits, and 797.6 billion are demand liabilities.
