Armenian bankers positive about trade finance agreements signed with ADB

YEREVAN, April 14. / ARKA /. Armenian bankers have commended today the Asian Development Bank (ADB) for signing trade finance agreements with six banks in Armenia to the tune of $17 million, saying the move will help bolster the country's trade sector and help ensure sustainable economic growth.

The trade finance agreements, the first signed by Armenia's banks with ADB, were signed with Ameriabank CJSC, Anelik Bank CJSC, Ardshininvestbank CJSC, Armeconombank OJSC, Converse Bank CJSC, and Unibank Armenia CJSC.

All the agreements were made under ADB's Trade Finance Program which provides guarantees and loans through banks to facilitate international trade in ADB's developing member countries.

“These agreements is another step to promote the continued expansion of the trade sector. It will allow importers to cut their expenses,’ Conversebank executive director Tigran Davtian said after the signing ceremony.

He said many Armenian importers still avoid such risk-free products as letters of credit preferring to either import goods and then pay for them or which is even worse, to make prepayments and enter risky zones. “Our goal is to explain to our clients that letters of credit are risk-free products,’ he said.

Artak Hanesian, Ameriabank CEO, said trade finance products are very effective and this idea should be carried down to trade firms because ‘it reduces risks in cross-border transactions, is more profitable than ordinary lending because of lower interest rate and because it takes much less time to formalize such transactions.’

He said Ameriabank has trade financing agreements with IFC, EBRD. Hanesian said as part of the agreements with ADB, loans will be extended for six months, also for opening guarantees and letters of credit at lower interest rates.  -0-