ArmInfo. On April 20, Converse Bank started the initial placement of the next tranches of AMD and USD bonds in the amount of AMD 3 billion and $10 million. This was reported to ArmInfo in the press service of Converse Bank, explaining that in the near future they will be available in the bank's mobile application.
The nominal value of AMD bonds is set at 50 thousand AMD, and dollar bonds at $100. The coupon yield is 9.75% on dram bonds and 5.25% on dollar bonds, respectively. The term of circulation of the bonds in both cases is provided for 36 months, and the frequency of payments under the coupon is once every six months.
According to the Bank, the above-mentioned issues of dram and dollar bonds will be listed on the Armenian Stock Exchange upon completion of the initial placement, which will start their circulation on the secondary market. The funds raised by the bonds are guaranteed by the Deposit Compensation Guarantee Fund. During the year, Converse Bank plans to issue dollar and AMD bonds with a total volume of up to $20 million and 5 billion drams, thereby ensuring the continuity of alternative financial products provided to customers.
Investments in bonds, unlike deposits, have a number of advantages, of which the most significant is the exemption of the interest income received from taxes. Another advantage is the possibility of selling the bonds on the secondary market before the expiration of their circulation.
More detailed information about the new issues is available on the Converse Bank website under the link: https://conversebank.am/hy/2021issue/
According to AMX, as of April 20, 2021, 7 issues of Converse Bank bonds are listed on the stock exchange. These are 3 dollar tranches in the total amount of $25 million, 3 AMD tranches in the amount of 5 billion drams, and 1 euro tranche in the amount of 5 million euros. All of these issues are included in the Abond master list. Payments on the coupons of these issues are made every six months. The yield of dollar issues since the first tranche (from May 5, 2017) on the currently placed ones has decreased from 5.75% to 5.25%, and of dram issues-from August 2017 10.5% to the current 9.75%. From the quoted prices as of April 20 this year. On the exchange of tranches of Converse Bank bonds in 2021, namely on April 26, one tranche of dollar, euro and AMD bonds will be repaid - respectively for $10 million (yield of 5.25%), 5 million euros (yield of 4%), 3 billion drams (yield of 9.5%), which were issued on April 26, 2018 with the completion of the initial placement on August 21 and entry into the listing list on September 5 of the same year. The repayment of the remaining four issues (2 AMD and 2 USD) will take place in 2022 (April 15 and October 17) in the total amount of 2 billion AMD and $15 million.
According to the Financial Rating of Armenian Banks as of January 1, 2021, prepared by ArmInfo IC, Converse Bank raised funds in the amount of 21.5 billion drams ($41.2 million) from the placement of its own bonds. Converse Bank holds the 4th position in terms of the volume of attracted funds from the placement of its own bonds.
It should be noted that Converse Bank has been operating in the Armenian market since September 1996. As of January 1, 2021, the Bank's shareholders are Advanced Global Investments LLc (hand of Eduardo Ernekyan) - 72.89%, HayPost Trust Management B. V.-22.11%, and the Cathedral of the First Cathedral of Etchmiadzin - 5%.
