EBRD: Banking Sector Of Armenia Is On Threshold Of Mergers And Acqui


Thursday, September 22, 15:22

The banking sector of Armenia is on the threshold of mergers and
acquisitions, and the market participants themselves should gradually
come to the relevant decision in this matter, without any external
pressure, Valeriu Razlog, Head of the EBRD Yerevan Office, said in an
interview with ArmInfo. He said that from this viewpoint the EBRD is
ready to help all the participant banks of Armenia in the projects on
consolidation and mergers, elaboration of new products and reformation
of the banking sector.

Razlog said that the idea of supporting the initiatives on
consolidation of the banks, enlargement of their capitals, assets and
branches has already been included in the strategy on cooperation with
Armenia in 2012-2015 being worked out by the EBRD. He added that the
EBRD’s new strategy related to the support to Armenia, will supposedly
come into force in April 2012 and will not radically differ from the
current strategy, though certain changes are expected.

It is still difficult to judge about the financing to Armenia for
the next 3 years, as the EBRD mostly focuses on development of the
private sector, which constitutes 92% of the EBRD’s credit portfolio in
Armenia. In addition, the EBRD wants to retain flexibility for possible
intermittent growth or decline in certain spheres, Razlog stressed.

Razlog said that due to its dialogue with the municipal authorities
the EBRD is planning to explore new sectors: public transport, water
supply, waste recovery. The bank has already implemented a number of
successful projects to upgrade a sewerage system near Lake Sevan and
to recover the Yerevan subway. In July, jointly with the European
Investment Bank and the European Union, the EBRD launched a program
to improve water supply in 23 settlements in Armenia.

Since 1994 the EBRD has lent Armenia over 435mln EUR ($626mln) for
almost 100 projects. The bank is partner to 12 Armenian banks.

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