Fitch rating agency stated that “the latest fighting does not have immediate negative implications for Armenian banks because the sector’s direct credit exposure to Nagorno-Karabakh is limited.”

“The sector’s credit metrics have reached historical highs due to large-scale immigration and significant financial inflows since the military conflict in Ukraine began,” Fitch said.

“The most immediate impact on Armenia’s sovereign credit metrics is likely to be through higher spending on refugees,” the agency said. At the same time, Fitch noted that Armenia has already received financial aid pledges from the US, EU and other sources for the integration of refugees of at least AMD27.7 billion (0.7% of GDP), and may receive further such assistance in 2024.