Institute of financial intermediation needs to be developed in Armenia
21.11.2007,
01:56
Institute of financial intermediation needs to be developed in Armenia, the President of the Central Bank of Armenia (CBA) Tigran Sargsian said.
YEREVAN, November 20. /ARKA/. Institute of financial intermediation needs to be developed in Armenia, the President of the Central Bank of Armenia (CBA) Tigran Sargsian said in making a report on development of the financial sector and Armenia’s wish to become a regional financial center at Economy Department of Yerevan State University.
According to Sargsian, currently CBA attaches particular importance to two problems – development of financial intermediation and increase of the share of financial system in GDP (Gross Domestic Product).
Sargsian also pointed out that the underdeveloped financial intermediation is the main shortcoming of Armenia’s financial system that leads to small share of Armenia’s financial system, despite its stability and reliability, in the structure of GDP.
Sargsian reported advanced growth rates recorded in Armenia in the last five years, particularly a 3-time increase in the banking system over the period. Assets of the banking are expected to make 22% of GDP as of the end of this year and credits are to make 12.7% of GDP, Sargsian said.
This shows that despite the high growth rates financial intermediation in Armenia is at a low level as compared with other countries, Sargsian said. He added that the indicators should be increased; particularly the assets of the banking system should be brought up to 40% of GDP.
As of the end of September, 21 banks and 318 branches operate in Armenia. The total assets of Armenia’s banking system were 664,003.5mln Drams. The level of financial intermediation increased 3.04 pct to 22.72% (19.69% in the beginning of 2007).
Income assets in GDP were about 19.3% (against 16.9% in the beginning of the year) and the share of credit investments of banks (with interbank credits and interbank deposits) was 12.42% (against 9.36%). The share of credits in GDP the means placed in banks exclusive was 12.04% (8.1% in the beginning of the year). ($1=317.73Drams).–0—
According to Sargsian, currently CBA attaches particular importance to two problems – development of financial intermediation and increase of the share of financial system in GDP (Gross Domestic Product).
Sargsian also pointed out that the underdeveloped financial intermediation is the main shortcoming of Armenia’s financial system that leads to small share of Armenia’s financial system, despite its stability and reliability, in the structure of GDP.
Sargsian reported advanced growth rates recorded in Armenia in the last five years, particularly a 3-time increase in the banking system over the period. Assets of the banking are expected to make 22% of GDP as of the end of this year and credits are to make 12.7% of GDP, Sargsian said.
This shows that despite the high growth rates financial intermediation in Armenia is at a low level as compared with other countries, Sargsian said. He added that the indicators should be increased; particularly the assets of the banking system should be brought up to 40% of GDP.
As of the end of September, 21 banks and 318 branches operate in Armenia. The total assets of Armenia’s banking system were 664,003.5mln Drams. The level of financial intermediation increased 3.04 pct to 22.72% (19.69% in the beginning of 2007).
Income assets in GDP were about 19.3% (against 16.9% in the beginning of the year) and the share of credit investments of banks (with interbank credits and interbank deposits) was 12.42% (against 9.36%). The share of credits in GDP the means placed in banks exclusive was 12.04% (8.1% in the beginning of the year). ($1=317.73Drams).–0—
