ArmInfo. Armenian banks have started to decrease the rate of lending to the economy, while increasing consumer lending at a faster rate.
In 2024, credit investments in the economy saw a growth slowdown from 23% to 18%, while retail loans experienced a significant acceleration from 18% to 33%. Retail lending took over as the main as the main driver of growth in the total loan portfolio during the year. This credit activity not only maintained double- digit revenue growth, but also slightly boosted growth rates, leading to a 61% increase in net profit by the end of 2024, reaching $915.8 million. This is evidenced by analytical data from the Financial Rating of Armenian Banks as of December 31, 2024, prepared by ArmInfo Investment Company based on published financial reports and additionally requested indicators.
As noted by the agency's analysts, stronger support for retail lending was the key factor that allowed the overall loan portfolio to accelerate in annual growth from 18% to 22%. This growth rate could have been higher if not for the reduction in the volume of interbank loans and some slowdown in the growth of lending to the economy. Consequently, the total volume of credit investments reached $17.7 billion. Of this amount, 51% or $9 billion were corporate loans, more than 43% or $7.6 billion were retail loans, and 6% or $1.1 billion were interbank loans/deposits.
Total banking assets reached $27.8 billion, experiencing a sharp increase in annual growth from 9.4% to 20%, This growth was attributed not only to lending activity, but also to notable improvements in the following key items: investments in securities - an exit from a 3.5% decline to an 18.2% growth (to $5.2 billion), balances on correspondent accounts in the Central Bank of the Republic of Armenia - an exit from a 24.3% decline to a 22.3% growth (to $2.2 billion), balances on nostro accounts in banks - an exit from a 3% decline to an 11% growth (to $759.6 million), cash reserves- an exit from a 5.4% decline to a 10% growth (to $590.9 million). However, there was a slight slowdown in annual growth for non-dominant asset items: balances on impersonal metal accounts - from 3.8 times to 3% (up to $2 million), and fixed assets - from 11% to 8% (up to $537.1 million).
