Ara Makaryan: ARMSWISSBANK localizes international best practice in Armenia

12.02.2024 | 17:35 Home / News / Interviews /
#ARMSWISSBANK #Ara Makaryan #European Investment Bank
Recently ARMSWISSBANK was selected as Partner Financial Institution (PFI) of a financial program financed by European Investment Bank. We talked about this and other topics with Ara Makaryan, Deputy CEO of ARMSWISSBANK, Director of Business Development Department.

- Mr. Makaryan, how important is cooperation with international financial institutions? In this case, what is the program of the European Investment Bank?

- Active cooperation with international financial institutes has been and remains one of the directions of strategic importance of ARMSWISSBANK. Such collaborations are important not only from the point of view of attracting funds on favorable terms for clients, but also from the point of view of capacity building support provided  by these organizations. In particular, through such support, we localize international best practices in our market.

This project named “Economic Resilience of Armenia” by the European Investment Bank is implemented within the framework of the agreement signed between the Central Bank of Armenia and European Investment Bank. Project is implemented through the “German-Armenian Fund” Project Management Office. The total volume of the facility is 70,000,000 Euros.

ARMSWISSBANK, having met the requirements presented to PFIs within the framework of this program, was again selected as a partner and carries out customer financing under this facility.

- Who is it aimed at, what does it offer and what are the main competitive advantages of this financing offered by ARMSWISSBANK?

- The purpose of the program is to finance private small and medium enterprises operating in the field of production, agriculture and tourism of Armenia. Financing of energy efficiency, women’s entrepreneurship, promotion of regional development, digitization and automation projects are considered as target directions. The component of “sustainability” is a desirable prerequisite in all projects.

Credit funds are provided by ARMSWISSBANK only in AMD and for a period of up to 90 months, of which, according to the specifics of the programs, a grace period of up to 12 months can be provided. The maximum amount of financing available to one client and an affiliated group is up to 12,000,000 Euros.

The main advantages of this program are the relatively long maturity, the possibility of granting preferential terms, wide target sectors, as well as the annual interest rate in AMD below the market (up to 10.5%).

- You mentioned the special component of “Sustainable” financing. What new steps is ARMSWISSBANK taking to develop this direction?

- Although in recent years “Green” and “Sustainable” financing are gradually more and more included in the agenda of Armenia’s financial market participants, however, there is still a great unused potential for the development of this direction.

ARMSWISSBANK has announced “Green” and “Sustainable” financing directions as a priority direction for financing and is developing it with all its potential. In recent years, the portfolio of financing in the mentioned directions has registered a significant increase, qualitative works have also been carried out, including the upgrade  of staff capacities, the adoption of relevant internal legal acts, the delivery  of the readiness  program financed by the Green Climate Fund, etc.

Recently, ARMSWISSBANK, the first in Armenia, joined the Partnership For Carbon Accounting Financials (PCAF) international community, which will enable us an opportunity to work with other financial institutions and develop a globally recognized approach to assess and disclose the greenhouse gas (GHG) emissions / avoidance associated with loans and investments. We are in the final stage of joining another European association, where we will have the opportunity to exchange experience with other European financial organizations. There are other initiatives in progress which we will be presented to public soon.

- What are the main obstacles encountered during the implementation of this goal, and what steps are necessary to overcome them?

- Before addressing the obstacles, I consider it important to mention that the progress in this direction is obvious.

In order to have continuous success, first of all, the level of awareness in the private sector should be raised, so that the investors in their investment projects take into account the social and environmental consequences in addition to the economic results, and give preference to more sustainable and socially responsible projects.

The next important step is the adoption of common approaches by the financial and banking system. In particular, it is necessary to implement a similar measurable system of “sustainability” or “greenness” of the credit and investment portfolio. By combining accountability with regular reporting, we will create statistics, which, with appropriate incentives, will drive progress.

And lastly, I would like to highlight the importance of localization of international best practices in the private and public system.

- What kind of new developments can customers expect from ARMSWISSBANK in the near future?

- Optimization is a non-stop process that is carried at ARMSWISSBANK on daily basis. Being a bank that provides non-mass services and targeting the sector of corporate and investment services, ARMSWISSBANK pays great importance to the quality and convenience of customer service.

Currently, direct negotiations are underway with two large financial institutions, whose proposed facilities can change approaches to traditional lending. Thus, it is planned to increase the access of SMEs to financial services.

In addition to lending and investment services, in the near future the bank’s clients will have the opportunity to be served in an environment equipped with ultra-modern technologies and meeting the requirements of any demanding client, which will be announced in the near future.
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