03.07.2007

Interview of the Chairman of the Board of “Unibank” Vartan Ataian to “Mediamax” Agency and Banks.am portal

- The implementation of a corporate management is considered to be one of the basic priorities of the development of the Armenian banking system. How do matters stand with “Unibank” concerning this?

- Large-scale work on transformation of the management system is coming to its final stage in “Unibank”. The composition of the Board of the bank was replenished, and each member of the Board has his/her own share of responsibility. In its turn, the staff of the Board of Directors formed due to the directors, responsible for concrete directions of activities of “Unibank”.

To secure more effective and substantial results in organization point of view, there are standing commissions and committees, functioning in the bank, the representatives of which are the members of the Board of the bank, among them - the committee on assessment of the work of the personnel, the committee on investments, etc. In fact, at present, all the members of the Board and the shareholders of the bank are informed on all the events and processes, taking place in the bank.

The necessity of implementation of a system of corporate management in our bank was conditioned by the fact that the activity of the bank actively extends and it is impossible for only the Chairman of the Board or the Board of Directors to manage the whole information.

Today, we meet the international requirements as to the implemented corporate management standards. The reforms are also in harmony with the work, which is realized in “Unibank” within the framework of ABN AMRO “Improvement of Risks Management Processes” program.

- How is the issue of adaptation of ABN AMRO program to the local conditions solved?

- The high level of professionalism of the specialists of ABN AMRO resulted in the fact that we can talk about adaptation of the program not only to the conditions of Armenia, but also to “Unibank” in particular. The specialists of ABN AMRO study the situation on the spot and, together with the leaders of the bank, make the corresponding decisions.

The implementation of the program means a considerable decrease of losses for us, a new quality level of customer service, increase of the image of the bank. And the most important - the main idea of the given process is the change of the way of thinking, the transformation of a bank with Armenian mentality to a European Bank, based on international standards.

- During the recent annual meeting of the Union of Banks of Armenia, a number of problems were voiced, which hinder the effective development of the banking system of the country, among which - the high index of spread of interest rates between the attracted and placed means, as well as the low level of involvement of customers, especially legal entities, in the banking sector of Armenia. What can you say concerning this regarding “Unibank”?

- In Armenia, the problem of high straddle is conditioned by the relative “greed” of the banks, the reluctance to offer the customers corresponding interest rates.

At present, the interest rate for the deposits in “Unibank” makes 10%, and the average interest rate of the provided credits – within 14-15%. Correspondingly, the spread of the interest rate in our bank makes 4-5%. According to various assessments, the spread of the interest rate should make 3% on average for the bank to be able to secure the prime cost of the provided services.

As regards the deposits of individuals, “Unibank” occupies the first place today, which inspires and at the same time commits us. People trust our bank; we register serious growth of the basic indices each month. The assets of the bank grew for 13bln drams from the beginning of the year, reaching the index of 43bln drams.

What concerns the level of involvement of the population in the banking sector of the country, I repeatedly talked about the presence of the given problem - at least 60% of Armenia’s population does not use banking services.

Recently I met the Coordinator for Issues of Financial Reforms of the USAID Yerevan Office, and I made a proposal to organize a joint informational-explanatory work for wide layers of population. Of course, the banks carry out active advertising campaigns, but the potential customers have no idea about the products provided.

I am sure that such an informational-explanatory action will give results. Evidence of which may be considered the growth of the volumes of population’s deposits, which was registered after the explanatory action concerning the Fund for guaranteeing the compensation of deposits, carried out by the Central Bank of Armenia.

The banks themselves should open the doors for the potential customers, providing them with profitable conditions of cooperation, which would meet the rules of the market. Today, the banking system of Armenia has the potential of growth at least for ten times, which is the reason of the desire of five new banks to enter our financial market.

- You repeatedly noted that the implementation of new technologies is one of the basic priorities of the development of the banking system of Armenia. What new services will “Unibank” offer its customers?

- The fact that there is a separate department, responsible for the modern technologies in our bank, states our special attitude towards the given issue.

“Unibank” is working over a number of new products. In particular, we take up active efforts to implement mobile banking, which, I am sure, will become the driving force for the young generation. There is work carried out to connect the cash machines, which are located outside the coverage of the fixed telephone networks, to the GPRS-network. By the end of the year, we plan to place our cash machines on the whole territory of Armenia, making their total number reach 60, gradually implementing cash-in functions in them.

We carry out work on on-line maintenance of the customers within the branch-network of “Unibank” as well.

I will also note that in the nearest future, the service of customers of UNIstream money transfer system will be realized with the use of plastic cards.