ArmInfo. The assets of the banking system of Armenia slowed down annual growth from 16.1% to 15.3%, amounting to 5.9 trillion drams ($ 11.7 billion) as of April 1, 2020. According to the Express-Ranking of Banks of Armenia, prepared by ArmInfo IC, in their structure credit investments and other loans reached 3.8 trillion drams ($ 7.5 billion), with annual growth accelerating from 16.2% to 20.4%.
In assets, the share of credit investments and other loans increased in annual terms from 61% to 63.7%, while a decrease in the share was observed for investments in securities - from 12.8% to 12.1% and nostro accounts and interbank investments - from 21.2% to 18.6%.
Bank investments in securities slowed annual growth from 11% to 9%, amounting to 715.4 billion drams ($ 1.4 billion). And nostro accounts and interbank investments, having experienced a more significant slowdown in annual growth - from 18.2% to 1.3%, could not move from the level of 1.1 trillion drams ($ 2.2 billion).
In TOP-5, Ameriabank, Ardshinbank, Armbusinessbank, ACBA-Credit Agricole Bank and INECOBANK secured assets, 56.5% of the total assets of the banking market (versus 55.8% a year earlier), with more than 43% concentrated in the first triples. These same banks are among the top five in credit investments, covering almost 61% of the total market, and again, with the dominant among the top three - 46%. Armswissbank holds the lead in investments in securities, while Ameriabank and Ardshinbank hold the second and third positions, and TOP-3 accounts for about 41% of total investments in securities, with the leader covering over 21%.
According to the analysts of the National rating agency AmRating, too restrained dynamics of highly liquid assets, while slowing down the growth rate of total assets and liabilities on demand, further reduced the levels of general and current liquidity. In particular, the total liquidity level on average in the market declined year on year from 31.95% to 31.57% (with a regulatory minimum of 15%), and current liquidity - from 176.88% to 170.80 % (with a regulatory minimum of 60%).
The interest income of the banking system, the lion's share of which is formed from loans, slightly accelerated annual growth - from 12.7% to 15.3%, amounting to 117.4 billion drams ($ 232.7 million). At the same time, the annual growth of non-interest income, formed mainly due to card transactions, money transfers and distance services, accelerated more significantly - from 4.1% to 26.3%, with reaching the level of 25.9 billion drams ($ 51.4 million).
Interest expenses, almost maintaining the annual growth rate of 10.2% against 10.4% a year earlier, amounted to I quarter of this year. 58.5 billion drams ($ 116 million), while non-interest expenses accelerated growth from 10.9% to 15.7%, amounting to 42.7 billion drams ($ 84.6 million). As a result, total revenues slowed down annual growth from 9% to 0.9%, but a reversal in the dynamics of total expenditures from ascending 14.4% to descending 5.1% allowed retained earnings to leave the 14.5% decline by 36.2 % growth. But only in the 1st quarter of 2020, book profit recorded growth of only 7.1% (against 21.1% quarterly growth a year earlier), with a more modest subsidence of total revenues than total expenses - 12.7% versus 16.5%.
It should be noted that in Armenia, as part of preventing the spread of the coronavirus pandemic, a state of emergency was introduced from March 16, which will last until June 13. In the first month of the emergency, a temporary ban was imposed on many types of economic activity, but in the middle of April a softening ensued, and from May 18 the ban was lifted subject to mandatory precautionary measures. Banks, in anticipation of the state of emergency, from March 13 announced a 2-3-month credit vacation for both individuals and business entities, while at the same time urging customers to use remote service systems. In addition, banks actively participated in anti-crisis programs aimed at both social support of citizens and assistance to a vulnerable category of business entities.
