ArmSwissbank and European Bank for Reconstruction and Development (EBRD) have signed an agreement for a USD 5 million (AMD equivalent) loan for SME finance.

The document was signed by Gevorg Machanyan, CEO-Chairman of the Board of ArmSwissbank CJSC and Mike Taylor, Director, Central Asia, Caucasus & Mongolia, Financial Institutions Team at EBRD.

G. Machanyan said the loan is unique, as it has been provided in terms of the national dram and will be on-lent also in terms of the national dram. The Bank will on-lend the raised funds to SME at the annual interest of up to 14% and maturity of up to 5 years. The maximal amount of the loan will be AMD 300 million. The SME having up to 250 employees can receive financing under the given program.

Machanyan said ArmSwissbank and EBRD launched cooperation in 2010 and the given loan agreement is the third in succession. The first USD 5 million loan agreement of the two banks was also made to finance SME. In the same year, EBRD opened a credit line in the amount of USD 3 million for ArmSwissbank as part of the Trade Facilitation Program (TFP). The amount has been increased three-fold over the years of cooperation reaching USD 9 million. As part of TFP, EBRD granted ArmSwissbank a status of a confirming bank. Until the end of the year, ArmSwissbank will raise another loan in the amount of USD 5 million from EBRD to finance power-saving projects.  

"The Bank highly appreciates the cooperation with the EBRD, as it implies financing on favorable terms, exchange of experience and staff retraining," Machanyan said.

M. Taylor, in turn, stressed the importance of raising funds in terms of the national currency to help de-dollarize the country's economy and make credit funds more accessible for SME.