Tuesday, April 20 2021 15:56
Karine Melikyan

On April 20, Converse Bank started the initial placement of the next  AMD and dollar bonds

On April 20, Converse Bank started the initial placement of the next  AMD and dollar bonds

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%. 

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