Expert: New opportunities for development of corporate bonds market of Armenia appeared with decrease in interest rates
ArmInfo.The reduction in interest rates has created new opportunities in terms of the development of the corporate bond market. Answering the question of ArmInfo during an online conference on the theme "Tendencies of interest rate changes", which was online broadcast on the official page of Ameriabank in Facebook, Retail Banking Director Arman Barseghyan said.
"When interest rates on deposits decrease, business entities, households try to find other directions for investment. And this market may be the market of corporate bonds. Companies with the appropriate risk profile, corporate governance level, institutional stability, when issuing bonds in conditions of low interest rates, will be able to place them more easily and more adequately. And in this regard, low interest rates will contribute to the activity of the corporate bond market," he said.
A. Barseghyan in this vein drew attention to Ameriabank's high activity in terms of issuing bonds (7 issues, 4 of which are dollar, 1 is euro, and 2 dram), which is taking place against low interest rates. He said that today Ameriabank has already issued 7 issues, 4 of which are dollar for $ 45 million, 1 for euro for 3 million euros, 2 for AMD 2.5 billion, and all of them are quoted on the exchange in the main list of Abond. The circulation term for dollar issues is set at 27 months, on drams - 1-2 years. The yield on the coupon with the dollar issues of the bank since the start of the first tranche to this day has decreased from 6.75% to 5.4%, and drams - from 10.75% to 9% (Editor - according to the Central Bank on November 1, The interest rate on annual dollar deposits - 4% and on drams - 8.8%).
In total Nasdaq OMX Armenia is trading on November 29, 2017 40 issues of corporate bonds of 12 issuers, out of which 22 issues were issued by 9 banks: Araratbank and Ameriabank (7), Armswissbank (6), Anelik Bank 4), two tranches from Armbusinessbank, Converse Bank and Unibank, one tranche from ACBA- Credit Agricole and DSTDB. Of the total number of corporate bonds quoted on the Exchange, there are 23 dollar issues, of which 21 are issued by 8 banks: Araratbank (6), Ameriabank and Armswissbank (4 each), Anelik Bank (3), and one from Armbusinessbank, Converse Bank, Unibank and ACBA-Credit Agricole Bank. In addition, 2 euro tranches are listed on the exchange - one Ameriabank and one from Armswissbank. The total number of bonds quoted on the exchange (40) includes also 3 drams of the National Mortgage Company, and 2 issues (1 dollar and 1 dram) of the UCC "Global Credit" and UCC "Finka".
CJSC Ameriabank is a universal bank that provides investment, corporate and retail banking services in the form of a comprehensive package of banking solutions. The bank has been operating in the Armenian market since October 31, 1996. The branch network of Ameriabank today has 13 divisions: 8 - metropolitan and 5 - regional. As of July 1, 2017, the Bank's shareholders are Ameriain Group - 65.8%, EBRD - 20.7% and ESPS Holding Limited - 13.5%.