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Armenia's Economic Pulse

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  • Re: Armenia's Economic Pulse

    Armenia's Telecom Sector
    Part II: Long Distance Communications

    The monopoly of the "last mile" by Armentel is a handicap, what is the situation of long distance communications?
    DECLINE IN PRICES OF DATA TRANSFER SERVICES IN ARMENIA POSSIBLE IN CASE OF OPERATION OF NEW FIBER OPTIC TRUNK

    Noyan Tapan
    Nov 20 2007

    YEREVAN, NOVEMBER 20, NOYAN TAPAN. Data transfer from Armenia to
    the outside world is currently done through the only fiber optic
    trunk that passes through the territory of Georgia. Harald Grytten,
    director general of the Armenian-Norwegian Armenian Datacom Company
    (ADC, http://www.adc.am) told NT correspondent that the high prices of data
    transfer services in Armenia are conditioned by this monopoly.

    According to him, the data transfer traffic prices are very high in
    Armenia as compared with international prices. He said that there
    is a project to construct a new Europe-Caucasus-Asia fiber optic
    trunk. In his words, it has not yet been decided whether the trunk
    will pass through Armenia or not, but there is a hope that having a
    new connection to international networks will help reduce the impact
    of Georgia's monopoly.

    http://mirror.nt.am/news.php?p=0&c=0...angID=1#106631
    Electronic Communications in Armenia

    A relatively comprehensive document covering the regulations and structure of electronic communications in Armenia: http://ec.europa.eu/information_soci.../4_armenia.pdf


    What is being/what can be done to correct the situation?
    NEW PHONE SERVICE RULES TO BE CONSIDERED IN ARMENIA MAY 20

    ARKA
    May 14, 2008

    YEREVAN, May 14. /ARKA/. RA Public Services Regulatory Commission
    (PSRC) will consider the rules of providing and using telephone
    services on March 20, said Gevorg Gevorgyan, Head of the Commission's
    Telecommunications Department.

    The rules have been developed with consideration of all the possible
    problematic situations peculiar to Armenian market, Gevorgyan said. New
    rules suggest that a telephone user have access to his current account
    and pay his bills via the Internet. Besides, customers will be allowed
    to sign an additional contract limiting their accounts.

    "We have studied the international practices to the rules competent
    enough to rule out any possibility for the users of paying for
    calls they have not made or any other error of the billing system,"
    Gevorgyan said.

    Armen Poghosyan, President of the Consumers' Association of Armenia,
    said the new rules should be adopted as soon as possible since
    the current rules dating from 1999 do not meet the present-day
    technological and legal requirements. Pogosyan said once the new
    rules are adopted they will work to introduce an obligatory system
    of signing individual contracts with each user.

    However, Pogosyan said, some of the rules are alarming since they focus
    on reducing the share of responsibility of provider and enhancing
    the liabilities of customers. "Neither do the rules provide for any
    compensation for system errors," Poghosyan stressed.

    Once the new rules take effect, ArmenTel will be obliged to modify the
    existing contracts with customers by July 1, 2009. Under the June 1,
    2007 decision of PSRC, the approval of the new rules was prolonged
    to December 30, 2007.

    ArmenTel is the daughter company of VimpelCom (Beeline). The Russian
    company acquired 100% shares in April 2007. ArmenTel provides
    fixed-line telephone services to about 600,000 customers and mobile
    services to over 450,000 customers.

    http://www.arka.am/eng/transport/2008/05/14/9396.html

    ALTERNATIVE TELECOMMUNICATION NET IN ARMENIA WILL HAVE LOW RETURN FOR GENERAL UNDERPOPULATION IN COUNTRY

    arminfo
    2008-05-13 18:51:00

    ArmInfo. An alternative telecommunication network in Armenia will
    have low return for the general underpopulation in the country,
    ARMENIAN DATACOM COMPANY (ADC) General Director Harald Grytten says
    in an interview with ArmInfo when commenting on the possibilities
    of liquidating the natural infrastructure monopoly in the country's
    telecommunication market. He believes that creation of an alternative
    net is unprofitable. It is possible to return investments only in the
    capital city, in regions it is impossible. As a result, the potential
    field of activity will be sharply reduced, H. Grytten says. He is sure
    that despite the alternative nets of optic and wireless technologies,
    DSL communication has always been dominating, and the statistics of
    European countries is an evidence of it. Cable net users exceed the DSL
    user only in the USA due to the wide penetration of IP-television,
    which is just being launched in Armenian, he says. As a result,
    telecommunication net and the terms of access to it are becoming of
    special importance. In this conditions, ADC Director General believes
    that state regulatory agencies must elaborate stricter rules of
    activity in the telecommunication market.

    In such situation the company attaches a special importance to
    negotiations and considers the readiness to conduct talks a good sign,
    he says.

    Speaking about the terms of using the net, suggested by ArmenTel,
    ADC director says they cannot radically change the situation in
    the telecommunication market. He also added that the problem of
    subscriber's tariff differentiation known in Europe as Local Loop
    Unbundling, (LLU), continues being one of the vexed problems at the
    Armenian market. ArmenTel gave access to the DSL lines to the companies
    interested but only subject to buying the "port", i.e. preserving
    total control over the telecommunication net. But even such partial
    introduction of LLU is a step forward by ArmenTel. Let's wait for
    further developments, H.Grytten says.

    To recall, in April of the current year ArmenTel
    changed internet-communication tariffs for final users and
    internet-providers. For this reason representatives of ArmenTel said
    there was a chance of creation of alternative communication nets
    by the interested companies if they are not pleased with ArmenTel
    net services.

    http://www.arminfo.info
    Last edited by Siamanto; 05-22-2008, 09:54 PM.
    What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

    Comment


    • Re: Armenia's Economic Pulse

      Armenia's Telecom Sector
      Part III: The Wireless Sector

      Who are the players?
      ARMENIA TO HAVE THIRD WIRELESS OPERATOR
      By Ruben Meloyan

      Radio Liberty, Czech Rep.
      Dec 14 2007

      The government has given the green light to the creation of Armenia's
      third mobile phone network and will call an international tender for
      that purpose next year, a senior official said on Friday.

      Robert Nazarian, chairman of the Public Services Regulatory Commission
      (PSRC), told reporters that the bidding for the wireless license will
      start on May 1 and last for 90 days. He said it will be administered
      by a special commission to be formed by the government.

      With Nazarian giving no further details, it is not clear when the
      government decided to further liberalize the Armenian market for
      wireless services. Prime Minister Serzh Sarkisian's cabinet has
      announced no such decision yet.

      Nazarian's statement followed a newspaper report earlier this month
      which said Armenia will soon have a third mobile operator. The
      pro-opposition "Zhamanak Yerevan" claimed that it will be owned by
      President Robert Kocharian's son Sedrak.

      Mobile telephony remained underdeveloped in Armenia until the
      government's decision in late 2004 to abolish a legal monopoly on the
      service enjoyed by the ArmenTel national telecommunications company.

      A Lebanese-owned company was hastily granted, without a tender,
      the license to build the second wireless network. The launch of the
      VivaCell network in summer 2005 led to an explosion in cellphone use
      in the country.

      VivaCell currently boasts over one million subscribers, or twice the
      number of Armenians using the ArmenTel network. The two companies
      are now owned by Russia's two largest mobile phone operators.

      http://www.armtown.com/news/en/rfe/20071214/200712143/
      TENDER TO CHOOSE THIRD MOBILE PHONE COMMUNICATION OPERATOR POSTPONED

      Noyan Tapan
      http://www.nt.am/news.php?shownews=113267
      May 13, 2008

      YEREVAN, MAY 13, NOYAN TAPAN. The rules of the tender to choose a
      third mobile phone communication operator in Armenia have not been
      approved yet.

      The head of the telecommunication unit of the RA Public Services
      Regulatory Commission Gevorg Gevorgian stated on May 13 that there
      is a necessity to hold additional discussions on these rules, as a
      result of which the tender has been postponed.

      G. Gevorgian failed to say when exactly the tender will be announced
      and which companies intend to participate in it. According to him,
      information about the tender will be published by famous foreign mass
      media, including the Financial Times.




      What was the participation of the sector in Armenia's economy in Q1 2008?
      K-TELECOM FIRST TAXPAYER IN ARMENIA FOR 2008

      arminfo
      2008-04-23 14:38:00

      ArmInfo.

      K-Telecom cellular operator (VivaCell trademark, subsidiary
      of MTS) has become the first taxpayer in Armenia for first quarter
      of 2008 by paying 6,813 billon drams taxes to the state budget, the
      Revenue Service of Armenia (RSA) reports. RSA published the list of
      300 biggest taxpayers for Jan-Mar 2008.


      Armenian-Russian ArmRusgasprom CJSC ranks second in the list by 6,746
      billion drams.

      CJSC ArmenTel (subsidiary of VimpelCom) occupies the
      third position in the list by 3.681 billion drams.


      Zangezur Cooper and Molybdenum Plant CJSC paid 3 billion drams taxes and occurred
      on the 4th position. The last in the top five taxpayers is Flash oil
      trader by 2.4 billion drams.

      CJSC Armenian Electric Networks is in the 7th position by 2.1 billion
      drams.

      Armenian Nuclear Power Plant is in the 13th position and Yerevan Brandy
      Company is in the 15th position. Ararat Yerevan brandy- wine-vodka
      plant is in the 42nd position in the list. RusAl Armenal is in the
      61st position, Armenian Railway in the 70th position and HayPost
      CJSC in the 129th position. The International Airports of Armenia,
      the concessionaire of Yerevan Zvartnots Airport, proved the 142nd
      yielding to many auto dealers of the country and even electronics
      shops. Armavia CJSC national air carrier was not included in the list.

      http://www.arminfo.info




      Amentel dominates the Fixed Line Sector, who is K-Telecom that dominates the Wireless Sector?
      MTS to Buy Control Of Armenia Provider (Russia)

      September 17th, 2007 8:07 am

      Mobile TeleSystems, the country’s largest mobile phone company, will spend up to 310 million euros ($430 million) to buy control of Armenian operator VivaCell, continuing expansion beyond the saturated Russian market, CEO Leonid Melamed said Friday.

      Mobile TeleSystems, or MTS, bought 80 percent in the parent company of K-Telecom, which operates under the VivaCell brand. MTS paid $546 per subscriber, Melamed said in a conference call from Yerevan.

      The price “implies high multiples with a market capitalization of $791 per subscriber,” Aton Capital Group said in a research note. “We believe the valuation is justified by high growth potential in Armenia,” where mobile phone penetration is 39 percent.

      Russian mobile phone companies, led by MTS, had about 162 million users in Russia at the end of July, 20 million more than the country’s population, and are looking at other markets to sustain growth. MTS has more than 78 million subscribers in Russia, Ukraine, Uzbekistan, Turkmenistan and Belarus.

      “This acquisition fully complies with our strategy to capture growth opportunities in the fast-growing CIS markets,” Melamed said, referring to the Commonwealth of Independent States, which includes 12 former Soviet republics. “We expect the company will show a double digit growth in the future.”

      Aton estimates the deal will add from 2 percent to 3 percent to Mobile TeleSystems’ revenue and earnings before interest, taxes, depreciation and amortization next year.

      Melamed said MTS would pay 50 million of the 310 million euros over the next three years if K-Telecom meets financial targets. He declined to be more specific.

      K-Telecom was founded by the Fattouche family, a Lebanese investment group that retains 20 percent in the company and may sell it to MTS between 2010 and 2012, Melamed said.

      K-Telecom has about a million subscribers and more than 66 percent of the mobile phone market in Armenia, a country of more than 3 million people.

      Last year, the company reported sales of $104.1 million and operating income before depreciation and amortization at $57.8 million. OIBDA as a percentage of sales was 54.4 percent and the average monthly revenue per user was $15.60. It stood at $12 in the second quarter this year, Melamed said.

      MTS will provide a 140 million euro technical loan to K-Telecom to pay off existing debt and help develop the company. MTS will make an announcement in the second quarter of next year if it decides to use the MTS brand instead of the VivaCell brand in Armenia.

      Nikolai Pryanishnikov, executive vice president at VimpelCom, the country’s second-largest mobile phone company, told reporters Friday that his company was “calm” about the deal “because we are competitive with MTS.”

      VimpelCom last year paid 341.9 million euros for Armentel, a fixed-line and mobile operator in Armenia.

      “It will be even easier for us, as MTS is a traded company and is responsible for making financial results more transparent,” Pryanishnikov said.

      http://wirelessfederation.com/news/category/k-telecom/




      Services. A brief comparison of xG features.
      VYMPELCOM RECEIVED FREQUENCIES FOR RENDERING 3G-SERVICES IN ARMENIA.

      Analytical Information Agency
      Oct 8 2007
      Russia

      The Joint-Stock Company "ArmenTel" (Armenia, 100 percent affiliated
      company of the Open Society " Vympel-communications " (Vympelcom)
      was received with the sanction of the Commission on regulation of
      public services of Armenia on use of radio frequencies 1920-1935 MHz
      and 2110-2125 MHz for rendering services of cellular communication
      of the third generation (3G) in the territory of the country. It is
      spoken about in the report of Vympelcom.

      The decision on granting 3G-radio frequencies to ArmenTel was accepted
      the Commission on regulation of public services of Armenia on October,
      1st, 2007. For reception of the corresponding sanction the company
      has directed the application on September, 25th.

      We shall remind that ArmenTel owns License #60 giving to the company
      the right to rendering 3G-services in the territory of Armenia.

      The Joint-Stock Company "ArmenTel" renders services of fixed and
      cellular telecommunication in standard GSM-900 and CDMA. The user's
      base of the operator makes nearby 600 thousand users of the fixed
      communication and 400 thousand cellular subscribers. Vympelcom owns
      100% of shares of ArmenTel.

      Vympelcom is the second-largest cellular operator in Russia and the
      CIS, it - serves more then 56mln subscribers. Its largest shareholders
      are Telenor (29.9% of voting shares) and the Alpha-groups (44%),
      other shares are in the free reference at the New York share stock
      exchange. The company has let out 51281022 ordinary and 6426600
      preference shares, all preference shares belong to "Alpha".

      The Net profit of Vympelcom on US GAAP in II quarter of 2007 has made
      $359.273mln that is 84.3% above the parameter of the similar period
      of the last year at $194.946mln. Proceeds have increased up 53.1%
      to $1.717mlrd from $1.122mlrd. OIBDA parameter has grown up 59.7%
      to $896.758mln from $561.555mln, OIBDA margin have increased up to
      52.2% from 50.1%.

      The Open Society "Vympelcom" borrows the 17 place in the "Leading
      enterprises of Russia" rating on the results of 2005, presented by
      the rating agency AK&M in September, 2006.

      http://www.akm.ru/eng/
      K-TELECOM FOLLOWS ARMENTEL INTO ARMENIA'S 3G SECTOR
      by Michael Lacquiere

      Global Insight
      October 10, 2007

      Armenia's leading mobile operator by subscriber numbers, K-Telecom, has
      been awarded a 3G licence by the country's Public Services Regulatory
      Comission (PCRC). The 10-year licence allows K-Telecom to offer 3G
      services throughout the country.

      Significance:Earlier this week a 3G licence was awarded to K-Telecom's
      rival in the mobile market, VimpelCom-owned Armentel (seeArmenia:
      9 October 2007. These developments will expand the sphere of
      competition in the country's mobile sector, in which K-Telecom had a
      two-thirds market share at the end of the first half of 2007, with
      986,000 subscribers, while Armentel had the remaining third, with
      471,000 subscribers. Following its purchase of K-Telecom last month,
      Russia's Mobile TeleSystems (MTS) promised to deliver new, innovative
      services and solutions, and the imminent arrival of 3G services
      suggests that the battle in Armenia will extend beyond subscriber
      numbers and into the sphere of value-added service uptake and revenue
      generation. MTS's Acting Vice-President and Head of Business Unit MTS
      Foreign Subsidiaries, Oleg Raspopov, noted in a press release that
      the addition of 3G services to the company's Armenian portfolio would
      "strengthen our leadership position", emphasising that the operator
      had already gained experience in the sector through its 3G licences
      in Russian and Uzbekistan.

      http://www.globalinsight.com/
      What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

      Comment


      • Re: Armenia's Economic Pulse

        1 of 2
        Armenia's Telecom Sector
        Part IV: The Fixed-Line Sector



        "THIS YEAR WAS SUCCESSFUL FOR ARMENTEL"

        Mediamax Agency
        Dec 11 2007
        Armenia

        Interview of the General Director of "ArmenTel" Company Oleg Bliznyuk
        to Mediamax Agency and Banks.am portal


        - "ArmenTel" Company ceased being a monopolist in the
        telecommunications market of Armenia on October 1. What does this
        mean for the Company and for the market as a whole? I remember you
        said that "universal happiness will not start on October 1".

        - Firstly, the decision on liberalization of the market only was
        made on October 1 of 2007. The procedure itself is still subject to
        discussion: corresponding political and economic levers have to be
        elaborated yet.

        As to my vision, the liberalization of the market does not mean that
        if someone wants to provide services, he goes and receives a license
        and starts providing those services at home or in the basement. In
        practice, the very notion of "service" consists of many components,
        starting from the quality and up to, for example, international
        commitments in the sphere of internet and the international connection.

        I am not at all against appearance of new providers, I am simply
        against low-quality services. See, if people do not buy from us a
        channel with the corresponding transmission line capacity, the final
        quality of their services, naturally, will suffer, but the completely
        unjustified references, according to which "ArmenTel" is the one to
        be blamed, will continue appearing.

        Another question appears as well: how are those companies going to pay
        the taxes? Will the situation, which was in the past, remain, or will
        everything become official? Various kinds of abuse are possible here.

        So, indeed, "great happiness", of course, will not take place. I
        believe that in the course of time, only a few companies will remain
        in the market, which will really carry out transparent work and will
        provide quality services.

        I believe that it will become possible talking about real
        liberalization of the market only in a few years. The regulator, to
        give its due, has done volume work, but I still have the impression
        that we are running ahead of the locomotive.

        What concerns "ArmenTel", we, of course, know how we will act. We
        will surely defend our economic interests, at that obeying the
        Armenian laws.

        Liberalization will not have negative influence on our customers.

        Renouncement of monopoly did not cause our Company major
        consequences. Yes, we can lose a part of our international and
        inter-town traffic, but we are ready for that and we are ready to
        compete. The most important is that the competition is fair and honest.



        - Can we assume that the purchase of 80% of "VivaCell" shares by
        MTS will make your competition more predictable and civilized, since
        "VimpelCom" and MTS have been for a long time competing in Russia?

        - I do not think that MTS will make any notable changes in the work of
        "VivaCell" before the spring of 2008. MTS is a high-tech and advanced
        company, and they will undoubtedly try to implement the culture of
        high technologies in Armenia.

        We know what to expect from MTS, we are competing in many markets,
        and this competition is of civilized nature. We realize that there
        will be no abrupt changes in Armenia, capable of collapsing the market
        or harm any of the companies.



        - More than a year has passed from the moment of acquisition of
        "ArmenTel" by "VimpelCom" Company. What achievements have been made
        in the course of this year, and what, on the contrary, you did not
        manage to do?

        - First of all, we realized then that much time and many efforts would
        be needed to understand what was going on in the company, since a
        certain part of information at the moment of purchase was unavailable
        for us. In the course of a year, we had to pay much attention to the
        organizational issues. Let's say, we planned to prepare a basis this
        year for advancing in future - to settle the things with billing,
        the fixed connection, construction of new basic stations.

        A very important fact is to settle the matters with the people, who
        work here, to solve the issue of social guarantees of the employees.

        Professional examination of employees has never been realized here.

        Of course, it took us much time to understand everything and to
        establish order.

        It took certain amount of time for the implementation of special
        procedures in "ArmenTel", which existed in "VimpelCom" and which
        correspond to the international accounting standards. Of course,
        it is difficult working with old procedures and simultaneously
        implementing the new ones. The shift of the billing system was
        accompanied with technical costs, which are inevitable in such cases,
        since we implemented a completely new version, which is not used even
        in Russia yet.

        Having analyzed the existing equipment of the mobile connection, we
        realized that we could not work with it. Despite the fact that the
        equipment was relatively new, it did not support many new functions,
        necessary, in particular, for the implementation of 3G. As a result,
        there was a decision made on changing the whole equipment, and this,
        of course, took us much time.

        I consider this year a successful one for the Company, since we put
        an important start for the future, carried out huge amount of rough
        work, which is not visible beyond the borders of the Company.



        - Will the technical modernization that you mentioned lead to the
        extension of the coverage zone of "ArmenTel" mobile network?

        - By the end of 2007 376 basic stations will function in the
        "ArmenTel"'s network. As a result, even today we have almost reached
        parity with the competitor, concerning the coverage part. When we
        purchased the company, the coverage made 65% of the populated territory
        of Armenia. Today the mobile network of "ArmenTel" covers over 90% of
        the populated territory of the country. We continue installing basic
        equipment and we intend to conclude the work, planned for this year,
        by mid-December.



        - So, you consider that the correlation, which exists today in the
        mobile connection market of Armenia - 65% of "VivaCell" subscribers
        and 35% of "ArmenTel"- will still change?

        - Of course, the picture will change and we work for that. We are
        not going to accept the situation, when "VivaCell" became the leader
        of the market in the course of two years. We use the potential,
        the knowledge and the financial opportunities of "VimpelCom" Group
        to change the situation.

        You know, it is possible to build a wonderful network, but if no one
        knows about it, the old stereotypes will function. Unfortunately,
        those stereotypes still exist, although "ArmenTel" is the national
        property of Armenia irrespective of who the owner of the Company is.

        We stand face to face with our subscribers and we worry very much,
        when we are informed that someone was rude with the customer in the
        service office. We have even launched a "helpline" for the people to
        inform us timely on violation of their rights. I assure that if you
        call this number and say the name of the employee of "ArmenTel", who
        was rude and unjust to you, and the results of the check prove that,
        we will say good-bye to such an employee.

        We have set for ourselves the task to become the best service
        company in Armenia. We have all the necessary components for that -
        the experience of "VimpelCom", technical opportunities, good people,
        who want to work and who think about the Company.



        - Lately, the leaders of Armenian companies, irrespective of their
        sphere of work, in increasing frequency raise the problem of lack of
        qualified personnel. Does "ArmenTel" come across this problem? If we
        talk about the high and middle level managers, is it better to train
        them within the company or invite from abroad?

        - The problem of invited specialists is not that acute for purchased
        companies. I believe that the invited managers are necessary for the
        first 2-3 years to implement certain business-processes and implant
        corporate culture. But for the most part, the personnel should be
        the local one - Armenians should work in an Armenian company.

        There is the problem of shift of generations. We have a project
        called "HR Reserve" in "VimpelCom", the essence of which is that each
        top-manager brings up people to a certain degree, since those people,
        sooner or later, will come to substitute him. We will implement this
        scheme in "ArmenTel" as well.



        - In summer of 2007, you put into commercial exploitation the service
        of broadband internet with the use of ADSL technology. How demanded it
        proved itself and can we assume that in the course of time "ArmenTel"
        will develop this type of services under an independent brand?

        - There is a specail group established in the Company, which works to
        develop this direction. It is yet quite cumbersome for the subscriber
        to connect to this service and we strive to facilitate the process as
        much as possible. I believe that in the beginning of 2008, serious
        changes will take place, which will concern both the prices and the
        types of the services provided.



        - Returning to the issue of stereotypes, certain part of the society
        has negative emotions for the very name of "ArmenTel", which is
        conditioned by the "Greek past" of the Company. On the other hand,
        you repeatedly stated that you do not consider the change of the
        brand justified before securing high quality of services. How can
        this dilemma be solved?

        - My personal attitude towards "ArmenTel" brand is very positive. It
        is another question that very serious mistakes were made in the past.

        I believe that we will not renounce the "ArmenTel" brand concerning
        the fixed connection.

        What concerns the court examination with the Armenian "Bi Line"
        Company, I think that soon this contingency will be solved and we will
        have an opportunity to present mobile connection services under our
        brand in Armenia. But my strict stance is that we should fundamentally
        improve the service, the quality of services and the attitude towards
        the subscribers before that. We do not want to position the existing
        negative attitude to the new brand.

        http://www.gab-ibn.com/IMG/pdf/Ar22-..._ArmenTel_.pdf
        .....




        GROWTH OF NET INCOME OF "ARMENTEL" EXCEEDED 300%

        Mediamax Agency
        Nov 30 2007
        Armenia

        Yerevan, November 30 /Mediamax/. The revenues of "ArmenTel" Company
        in the third quarter of 2007 made $ 63mln 277 thousands, $25mln 723
        thousands of which fell on the share of the mobile connection, and
        $37mln 554 thousands - on the share of the fixed connection.

        Mediamax reports that the report, following the results of the
        financial and operations activity of "VimpelCom" in the third quarter
        of 2007, reads this.

        The revenues growth of "ArmenTel", as compared to the second quarter,
        made 8.4%.

        The OIBDA index (Operating Income before Depreciation and
        Amortization) of "ArmenTel" in the third quarter of 2007 made $32mln
        888 thousands. The growth of OIBDA, as compared to the second quarter,
        made 9.4%.

        The net income of "ArmenTel" in the third quarter made $15mln 961
        thousands. In the second quarter the given index stood at $3mln 963
        thousands. The growth of the net income made 302.8%.

        The number of active subscribers of the mobile network of "ArmenTel"
        in the third quarter of 2007 made 446 957. The number of active
        subscribers reduced by 5.1%, as compared to the second quarter,
        when the Company had 471 000 active subscribers.

        The share of "ArmenTel" in the mobile connection market of Armenia
        stood at 33.6% in the third quarter.

        "The main problem area, which causes our concern, is the share
        of market of subscribers in the mobile market of Armenia. We have
        already taken up a number of measures, directed to strengthening our
        competitive positions. And although there are already the first signs
        of positive influence of those measures, it will take us some time
        to fully use the effect of the realized measures", the report reads.

        The average revenue per user (ARPU) of the mobile network of "ArmenTel"
        Company made $17.6 in the third quarter, having increased as compared
        to the second quarter for 1.7%.

        The average revenue per user (ARPU) of the fixed network of "ArmenTel"
        Company made $20.4 in the third quarter of 2007, having increased
        for 5.7% as compared to the second quarter.

        The number of "ArmenTel" fixed connection subscribers in the third
        quarter made 616 175, having increased as compared to the second
        quarter for 1.0%.

        http://www.mediamax.am/main_e.htm
        What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

        Comment


        • Re: Armenia's Economic Pulse

          2 of 2

          Armenia's Telecom Sector
          Part IV: The Fixed-Line Sector



          Vimpelcom to operate in Armenia with beeline brand


          YEREVAN, March 7. /ARKA/. The principal task of the VimpelCom public
          corporation in Armenia is rebranding and ArmenTel Company's operation
          in conformity with the universal standards of the group of companies.

          `We are sure that we have the full right to operate with our brand in
          Armenia and we are happy that we have legal grounds to connect the
          country to the BeeLine area,' stated Executive Vice-President for
          Business Development in the CIS Dmitry Pleskonos.

          The company had this opportunity after February 25, when the RA
          Intellectual Property Agency decided to register a license agreement
          between VimpelCom and ArmenTel (the latter being the VimpelCom's
          daughter company in Armenia) on the transfer of right to the use of the
          Beeline brand.

          The Agency also registered the slogan `Live on the bright side!' to be
          used in Armenia. It means that from this date ArmenTel can use the
          brand on a legal ground.

          This January the RA Court of Cassation confirmed the application of
          international registration of the Beeline brand to communication
          services in Armenia. Immediately after the verdict was returned,
          VimpelCom initiated a procedure of registration of the transfer of
          right to the use of its brand to the ArmenTel Company in Armenia.

          Under the license agreement, ArmenTel is to pay to the parent company
          100,000 RUR as one-time consideration for a license for the use of
          brands in Armenia during the entire period the registration of the
          brands is in effect.

          VimpelCom's promotion plans for the Beeline brand in Armenia were
          hindered by a conflict with an Armenian company specializing in
          software development, assembly and sale of computer. The company's
          brand Bi Line sounds similar to Beeline (in Armenia and Russian).

          The management of the Russian company considers the situation
          artificially complicated ` ArmenTel has no intention to sell computers,
          and Bi Line does not plan to enter the telecommunications market.
          The RA Administrative Court is currently considering a claim lodged by
          the Armenian Bi Line IT-company against the Intellectual Property
          Agency. The claimant demands the invalidation of the Agency's decision
          on the abeyance of the Bi Line brand.

          ArmenTel holds a monopoly of stationary telephone communication in
          Armenia. The company is also one of the mobile communication operators
          in Armenia. In April 2007, VimpelCom (Russia) became full owner of
          ArmenTel.

          The Vimpel Com Group comprises communication operators from Russia,
          Kazakhstan, Ukraine, Tajikistan, Uzbekistan, Georgia and Armenia.
          VimpelCom's licenses for GSM and 3G communication services are in
          effect in a territory with an approximate population of 250mln people.

          VimpelCom was the first Russian company listed on the New York Stock
          Exchange, its shares being symbolized as VIP. `0--

          http://www.arka.am/eng/transport/2008/03/07/8438.html



          'ARMENTEL' INVESTED ABOUT $63 MLN IN UPGRADING IN 2007

          armnifo
          2007-11-16 14:47:00

          ArmInfo. "ArmenTel" CJSC invested about $63 mln in the Company's
          upgrading from early 2007 to the midst of November, Director General of
          "ArmenTel" Oleg Blizniuk told journalists today.

          He said that the investments were attracted mainly to upgrading of
          the network, implementation of a new billing center and development
          of information technologies. The director general said that the
          Company will master $90 mln of investments till the end, 2007. He
          called the current year difficult for "ArmenTel" as "it underwent
          many changes and alterations". The plan of investments for 2008 is
          worked out taking into account the subscribers' needs and now it
          is specified, O. Blizniuk said. He added that "ArmenTel" intends to
          develop both the cell network and the fixed one in 2008. The Company
          will complete digitization of ATS in Yerevan in the near future. At
          late, 2008, it may pass to the new plan of numeration and implement
          seven-digit telephone numbers in Yerevan and six-digit ones in the
          regions instead of the present six-digit and five-digit numbers,
          respectively. "ArmenTel" intends to change the numeration plan only
          if demand is available in the market.

          Oleg Blizniuk also commented on the information in the Armenian press
          saying that "ArmenTel" dismisses its employees in order to sale the
          fixed business.

          O. Blizniuk called it a "real raving". He explained that "ArmenTel" had
          never followed the requirements of RA Labour Legislation before. "We
          have to follow these requirements. It became clear during the
          professional inspections that many employees cannot take stay at the
          positions they take for a number of professional diseases. Dismissals
          and transfer of the people to another job give us no pleasure as
          we loose professional staff as a result of it, the people , who had
          worked in the Company for 20-30 years", O. Blizniuk said.

          To recall, 100% of shares of "ArmenTel" CJSC belong to the "Vimpelcom"
          Ltd.

          http://www.arminfo.info
          What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

          Comment


          • Re: Armenia's Economic Pulse

            Armenia's Financial System
            Part I - Armenia's Financial Aspirations


            AZG Armenian Daily #101, 28/05/2008

            Financial

            FIRST FINANCIAL AND BANKING CONFERENCE IN ARMENIA

            Union of Armenian Banks held its first financial and
            banking conference in the hall of `Mountainous
            Armenia" vacation home in Dilijan (Armenia).

            RA President, Prime Minister, Chairman of Central Bank
            and heads of organizations of financial and banking
            system participated in the conference.

            The aim of the conference was to clarify the basic
            directions of future development of the financial and
            banking system in Armenia, also the role of the system
            in the approaches and programs of RA general
            development.

            President Serge Sargsian mentioned in his speech that
            the financial system of Armenia has a real potential
            to become a financial center in the region.

            "We'll bring experience, modern methods and form
            stable traditions of activities in financial markets.
            In this sense entrance of the Stockholm Exchange to
            Armenia I qualify positively and we should continue
            taking of similar influential steps.

            Serge Sargsian highlighted the progress of the
            financial and banking system and mentioned that it can
            serve as a locomotive for all the branches of the
            economy and for the solution to the problems of the
            population. According to the President, one of the
            important sides of the financial and banking system
            are the economic processes and introduction of a
            culture based on confidence in public relations

            The Armenian financial sphere has also another issue
            in its way of development; the factor of proportionate
            development. According to the President, it is
            impossible to get serious results if the economic
            development is not felt by each citizen.

            Prime Minister Tigran Sargsian touched upon the issue
            how to become a financial center. According to him,
            the works should be carried out in 6 directions.
            These, in their turn, will reveal the relative
            superiorities of Armenia. The international experience
            dictates where those superiorities are.

            The PM mentioned that several advantages are available
            in Armenia compared with the regional countries.
            First, comparatively inexpensive manpower that is
            fluent in Russian, English, etc. Second, the payment
            and accounts system functioning in real period of
            time, and third, the readiness to become a financial
            center that assumes political will to carry out
            necessary amendments and form corresponding
            legislation.

            During the conference a film was shown dedicated to
            the analysis of the financial centers' international
            experience, and then took place the presentation of
            the "Code of rules of banking business ethic" worked
            out by the Union of Armenian Banks.

            After the conference RA President, Prime Minister and
            Deputy Chairman of the Central Bank visited the new
            building of the educational center of the Armenian
            Stock Exchange and Central Bank.

            By Nairi Muradian, translated by L.H.

            http://www.azg.am/EN/2008052802

            Mediamax, Armenia
            May 27 2008


            Armenia Moving Toward Becoming Financial Powerhouse


            The idea of turning Armenia into a financial and banking center
            should be our guide for the nearest years, President Serzh Sarkisian
            stated today.

            Mediamax reports that Serzh Sarkisian said this during the first
            financial-banking conference, organized by the Union of Banks of
            Armenia (UBA), which took place in Dilijan today.

            `From now on, we should not compare the development speeds of the
            Armenian financial system to the indices of the countries of the
            region, but should find out to what extend we approached the world
            trends', the President noted.

            Serzh Sarkisian stressed the importance of OMX Group's presence in the
            republic, noting that this brand-named exchange operator will help the
            formation of a competitive financial market in Armenia, meeting the
            international standards.

            According to the President, the banking system should become a
            locomotive of Armenia's economy.

            Serzh Sarkisian highlighted the necessity to establish trust relations
            in the financial sphere.

            `Trust relations should be spread in all the spheres of business. Time
            will come and the factor of trust will be stronger than the factor of
            legal norms in the relations between sides', the President stated.

            He also stressed the importance of even territorial development in
            Armenia, noting that the citizens of the country should feel economic
            growth on themselves.

            `We will take up all the necessary legislative and political measures
            to reach the goals set', Serzh Sarkisian stated, adding that the
            authorities are ready to consider proposals from participants of the
            financial market.

            http://www.galiq.com/124/armenia-mov...al-powerhouse/

            Opinion of the Prime Minister, former Central Bank of Armenia Chairma

            Arab States May Move Financial Center To Armenia From Lebanon

            Huliq.com
            May 26, 2008

            The Prime Minister of Armenia Tigran Sargsyan says that Arab states
            express a wish to move their financial and banking center from Lebanon
            to Armenia as Armenia makes serious steps to become the regional
            financial center by dedicating northern town of Dilijan specially for
            this purpose.

            Yerevan /Mediamax/. Arab states express a wish to move their financial
            center from Lebanon to Armenia, proposing to carry out the
            corresponding legislative changes in the republic.
            Mediamax reports that the Prime Minister of Armenia Tigran Sarkisian
            said this today, speaking in Dilijan at the first financial-banking
            conference, organized by the Union of Banks of Armenia (UBA).
            `Armenia can become a bridge between Europe and Moslem states', Tigran
            Sarkisian stated, adding that to turn into a financial center for the
            Arab world, Armenia should gain the outline of an off-shore zone, which
            will present profitable financial services according to world
            standards.
            The Prime Minister also noted that Armenia can organize trading of
            securities of CIS states.
            `Along with the development of securities markets of CIS states, there
            is yet the problem of securities' entry to foreign markets unsolved,
            and Armenia can propose CIS auspicious conditions to place their
            securities.
            OMX Group operator, which has entered the Armenian market, may realize
            crucial programs', Tigran Sarkisian stated.
            Head of the government also noted the importance of establishing in
            Armenia investment funds and systems of assets management. According
            to Tigran Sarkisian, the Armenian population has about $2bln cash on
            hand and the presence of investment funds will allow placing those
            assets. He added that the transition to accumulative pension system
            will contribute to the formation of share investment funds and a
            system of assets management.
            `The insurance market and the market of securities of Armenia fall
            behind in development from the banking system, and active reforms are
            necessary in these spheres. The main resource of the financial sphere
            is intellect, consequently, special attention should be paid to
            financial education', Tigran Sarkisian stated.

            http://www.huliq.com/60384/arab-stat...rmenia-lebanon

            The Appointment of the Minister of Finance
            TIGRAN SARGSIAN: ONE OF GOVERNMENT'S PURPOSES IS TO MAKE ARMENIA A FINANCIAL CENTER

            Noyan Tapan
            April 22, 2008

            YEREVAN, APRIL 22, NOYAN TAPAN. One of the important purposes of the
            government is to make Armenia a financial center, the prime minister
            Tigran Sargsian stated when introducing the newly appointed minister
            Tigran Davtian to the staff of the ministry of finance. The prime
            minister said that T. Davtian is known among economists as an
            experienced specialist who is well-familiar with the economic problems
            of the country, also as a decent, educated and honest person with a
            rich biography.

            The former minister of finance Vardan Khachatrian said that he assumed
            this post in 2000 in hard conditions when the state budget's current
            deficit amounted to 63 bln drams (about 203.2 mln USD at the current
            exchange rate), while economic growth made 4.2%. In his words, by
            common efforts they managed to get out of this situation and enter
            a period of sustainable development. V. Khachatrian expressed an
            opinion that an electronic procurement system should be introduced so
            that in 2010 it will be possible to transfer to a programmed system
            of budgeting.

            http://www.nt.am/news.php?p=0&c=0&t=...angID=1#112563

            Some Reactions/Opinions
            ARMENIAN BANKERS BACK IDEA OF TRASNFORMING ARMENIA INTO FINANCIAL CENTRE

            ARKA
            May 26, 2008

            YEREVAN, May 26. /ARKA/. Armenian bankers totally agree with the
            president's idea of transforming Armenia into a financial centre.

            President Serge Sargsyan, Prime Minister Tigran Sargsyan, Central Bank
            managers and key players in the financial and economic system were
            attending the conference to discuss the ways of achieving this goal,
            as well as Armenia's advantages in the sphere.

            Ardshininvestbank CEO Aram Andreasyan said it will take much time and
            effort to achieve this goal. "Adopting the practice of other countries
            currently viewed as financial centres will strongly stimulate Armenia's
            economy in general," Andreasyan said.

            CEO of the Conversebank closed joint-stock company Ararat Ghoukassyan
            said four of the 35 financial centres existing in the world are
            global and one is a specialized one. Armenia is planning to become
            a specialized financial centre.

            He also said the premier's idea to create a Global Development Bank
            is quite interesting. "The financial system of Armenia should expand
            its functions since our practice is not quite enough to provide modern
            investment and banking services," Ghoukassyan said expressing optimism
            that Armenia will succeed in achieving this.

            Executive director of Biblos Bank Armenia Vahagn Amirganyan closed
            joint-stock company said formation of a financial centre should follow
            the formation of a business environment. "To raise the attractiveness
            of the country's business environment we need to handle a number of
            problems, namely, to apply international accounting standards, so
            that they are easily understood by foreign investors. " he said.

            http://www.arka.am/eng/finance/2008/05/26/9555.html

            CAN ARMENIA BECOME A FINANCIAL CENTER?
            Vasak Tarposhyan

            Hayots Ashkhar Daily
            Published on May 27, 2008
            Armenia

            "Armenia has real potential to become a financial center in the region.

            I strongly believe in this prospect and I'm sure this idea must become
            the guideline of our work in the coming years," the president announced
            during the first financial banking conference hold in Dilijan.

            Though the idea to become a financial center in the region is far
            not new, such high level announcement has been made for the first
            time. The important thing is that practical steps are already being
            made in this direction and the construction of the Funding Exchange
            and Central Bank Study Center in Dilijan testifies to this fact.

            Thus in essence not only the base of the formation of the regional
            financial-study center is laid, but also the first steps are taken
            for the country's proportional development. It is not a secret that
            the economy is strictly centralized in Yerevan.

            To become a financial center, Armenia really has a dynamically
            developed and a stable banking system. A productive legislative
            field is formed for the banking activity, which has created favorable
            conditions for the flow of the foreign investments in our country. The
            positive developments in this direction are evident. Especially during
            the recent one-two years a serious interest of foreign capital towards
            Armenian is really noticeable. Whereas not only the capital of the
            existing banks is completed by the foreign financial means but there
            is also a requirement to open new banks.

            The factor of the Diaspora is a very good advantage for Armenia to
            become a financial center. To make this advantage practical the idea
            of establishing a pan-Armenian bank has been proposed, which needs
            to be discussed.

            Prime Minister Tigran Sargsyan says the existence of the professional
            potential is also a great advantage for Armenia to become a financial
            center. And, the most important thing is that the readiness to become
            such a center is the basis of the political will to make necessary
            reforms.

            Of course we can't say that all the conditions exist in Armenia,
            in order to become a financial center. There are lot's of problems
            that we must solve. The most important problem here is the one linked
            with the currency market. The steps taken in this sphere during the
            recent years didn't give any positive results; the currency market is
            not completely accomplished. But the steps taken in this direction
            inspire hope that the situation will change very swiftly. Last year
            a famous intentional company managed Armenia's funding exchange. The
            entrance of Stockholm exchange can finally promote the accomplishment
            of the currency market in Armenia.

            The next obstacle is linked with the accumulated pensions and
            investment funds, which are not formulated in Armenia.

            It is worth mentioning that Georgia also pretends to become financial
            center of the region. Of course Armenia's banking system is one
            step forward from the Georgian, but during the recent years serious
            reforms are being made in Georgia's banking system, which can change
            the situation.

            But Armenia must do its best to achieve its goal otherwise tomorrow
            it will be very late.

            http://www.armtown.com/news/en/has/20080527/258583277/


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            Armenia: banking hub
            What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

            Comment


            • Re: Armenia's Economic Pulse

              Armenia's Financial System
              Part II - As Perceived By International Institutions



              Mediamax Agency, Armenia
              Feb. 25, 2008

              Armenian banks are well capitalized and profitable, but the financial
              sector lacks diversification, the EBRD report reads


              Yerevan, February 25 /Mediamax/. The banking sector of Armenia is
              fully privatized and has undergone primary consolidation, which was
              followed by increase in mid-2005 of the requirements as to the
              sufficiency of the capital'.

              Mediamax reports that this is stated in the report of the European
              Bank for Reconstruction and Development (EBRD) on the process of
              transition for 2007.

              `In January of 2006, consolidation of the banking and non-banking
              control within the framework of the Central Bank of Armenia took
              place, and today such control covers 400 insurance companies, credit
              organizations, broker companies and exchange points.

              This assisted the increase of prudential standards for non-banking
              financial mediators and led to revocation of a few licenses. In 2006,
              a system of insurance of deposits was implemented, and the banks
              passed on to the International standards of financial accounting.

              On the whole, the banks are well capitalized, are liquid and
              profitable, and the quality of credit portfolios remains relatively
              high. At the same time, the financial sector lacks diversification,
              and the non-banking financial sector remains small.

              The growth speeds for private crediting increased, especially
              concerning consumer and mortgage credits, however, the total share of
              the credit activity in the economy still makes less than 10% from the
              GDP', the report notes.

              http://www.gab-ibn.com/IMG/pdf/Ar10-...profitable.pdf
              http://www.ebrd.com/pubs/factsh/country/armenia.pdf


              Forbes, NY
              Dec 26 2007


              Armenian banks' credit outlook stable - Moody's

              12.26.07, 12:20 AM ET



              MUMBAI (Thomson Financial) - Moody's Investors Service the credit
              outlook for rated Armenian banks is stable, reflecting an evolving
              regulatory framework, buoyant credit growth, low banking penetration,
              robust aggregate capitalisation and good asset quality.

              In its new banking system outlook for the country, the ratings agency
              said these strengths are offset by the challenging operating
              environment, potential for accelerated asset quality deterioration
              due to the unseasoned nature of loan portfolios, and real concerns
              regarding operating risk due to under-developed infrastructure.

              Moody's (nyse: MCO - news - people ) said the Armenian banking sector
              has undergone considerable consolidation in the past decade after the
              banking sector turmoil of the mid-1990s and subsequent tightening of
              prudential regulations.

              Moody's said it notes that the system, comprising twenty-one banks,
              remains highly fragmented, however, the four largest banks control
              45.54 pct of total banking system assets and the ten largest banks
              79.61 pct.

              The ratings agency said the Armenian banking sector lacks economies
              of scale in its current structure, resulting in low productivity and
              thereby raising the potential for further market consolidation.

              Moody's said it notes that Armenia's regulation is improving from a
              historically low base, and could benefit from further refinement and
              better infrastructure and risk controls.

              Moody's said it maintains a generally positive view regarding banks'
              efforts to expand their retail and mortgage lending operations,
              although the rating agency emphasises that fast credit expansion
              could result in elevated non-performing loans (NPLs) for the system
              in an economic downturn, particularly as loan portfolios are not
              seasoned.

              As the country's nascent banking sector evolves and the sector's loan
              book term structure lengthens, Moody's said it expects NPLs to grow
              to levels observed in other countries at similar stages of
              development.

              The weight of foreign-currency loans as a proportion of total loans
              has decreased significantly in recent years, from a high of 78 pct of
              total loans in 2002 to around 42 pct towards the end of 2007.

              'If the weight of foreign currency-denominated loans continues to
              contract at current rates, our concerns are likely to be alleviated,'
              Fimi Gostanian, a Moody's senior associate said.

              http://groong.usc.edu/news/msg215712.html


              ARMENIA'S BANKERS ARE AMBIGUOUS IN NECESSITY OF SECURITIZATION OF ASSETS

              arminfo
              2008-05-22 01:13:00

              ArmInfo. Armenia's bankers are ambiguous in necessity of securitization
              of assets, the results of voting of May 21 "English Debates" in
              "Marriott Armenia" Hotel, organized by an independent rating agency,
              member of the international Global Rating Group, certify. The debates,
              with participation of over 30 representatives of commercial banks,
              heads of credit companies, investment companies and experts, were
              dedicated to the topic 'Securitization as a Required Tool for
              Increasing Liquidity of Banking Assets. Is that Right?'.

              The event was held under support of the Union of Banks of Armenia,
              USAID and East West Management Institute within the frames of the
              Partners for Financial Stability programme.

              Member of the Central Bank Board Karine Minasyan said in her speech
              that CB is currently working over implementation of new alternative
              tools for regulation of the processes of securitization of banking
              assets.

              The first tool is a possibility of issuing mortgage bonds by banks
              and credit organizations. Moreover, free issues will be carried
              out under tight control of a megaregulator. "We envisaged numerous
              regulatory mechanisms to assure high reliability of these securities
              and confidence of investors", she said. The second tool will be a
              "pure" form of securitization, which envisages real sale of assets to
              a specially created legal person. "The draft laws we intend to shortly
              introduce, envisage a possible alternative, due to which any market
              participant will be able to realize different initiatives in the area
              of securitization", K. Minasyan said. Along with it, member of CB Board
              presented the advantages the market participants will receive using
              the tools of securitization of assets. "In particular, this will allow
              the companies to extend their business, receive an additional income,
              manage the credit risks more efficiently and release the resources",
              K. Minasyan said.

              For his part, co-Director of AEPLAC Tigran Jrbashyan said that
              securitization in Armenia is not a new phenomenon. 'In a period of
              privatization in Armenia in 1993-94, when the major part of the state
              property was transformed into a form of unclear joint- stock companies,
              an elementary securitization of state assets was also observed, a so
              called voucherization', T. Jrbashyan said and added that a postulate on
              non-readiness of Armenia for securitization may be ruled out. 'provide
              the market with a tool and, believe, the Armenians will make a profit
              of it', he said part in play. In addition, he said, not only mortgage
              loans but consumer credits as well may be subject to securitization
              of assets in Armenia. Along with it, T. Jrbashyan emphasized that
              implementation of international standards during securitization is
              an important moment for attraction of funds.

              T. Jrbashyan expressed confidence that a boom around the banking
              assets shows that there are banks in the country with enough capital
              for investment in securities. 'They need a relevant tool. However,
              a certain liquidity problem exists in the banking system, especially
              in the actively working banks. Despite the fact that the Armenian
              market is not integrated enough in the world one, the volume of
              available resources reduced, and this problem will intensify', AEPLAC
              co-director said.

              Director of the 'Capital Assets Management' Investment Company Tigran
              Karapetyan, holding to the opinion of international experts, said
              that the minimum volume for profitable and efficient securitization
              should exceed $250 mln. T. Karapetyan thinks that securitization of
              assets in Armenia may be efficiently carried out only in case of a
              cumulative credit portfolio of the Armenian banks, totaling about
              $1.5 billion. 'Only in this case, securitization will be profitable,
              however, unification of the banks in one pool is not real', he
              emphasized. T. Karapetyan divided the risks during securitization into
              two types: the market and legal risks. Talking about the first one,
              he said that the property is a pledge of the credit portfolio of the
              banks being an object of securitization. Based on this, he said, the
              size and quality of credit portfolios largely depend on the state of
              the real estate market being in a state of overheating. As for the
              legal risk, T. Karapetyan expressed an opinion that not the whole
              legislation covers the available legal risks today. Along with it, he
              shared the viewpoint that securitization will be impossible without
              the relevant international standards, as assessment of assets and
              the property is connected just with them.

              T. Karapetyan thinks that not all the banks of the country need
              securitization today. 'The current liquidity ratio of the Armenian
              banks exceeds the required CB standards one and a half times. In
              any case, if the bankers think about increase of liquidity of their
              assets, securitization will not become a task of prime importance
              for them. An international institutional investor is necessary for
              the first successful securitization in Armenia. However, under the
              present crisis in the international market, I do not think that its
              attraction in a short-term prospect is real', he said.

              Deputy Chairman of the Board of 'Converse Bank' Tigran Davtyan,
              who also marked a non-topical nature of securitization of assets
              in Armenia, substantiated his position by the fact that even simple
              bonds in the country are presently sold with difficulty. 'Currently,
              the local banks experience a problem of liquidity, and a deficit
              of available long-term resources is the greatest problem for
              them. Therefore, the market today is not ready for securitization',
              T. Davtyan emphasized.

              To note, the independent Rating Agency AmRating, being part of the
              GlobalRating Rating group, which also includes RusRating (Russia)
              and KzRating (Kazakhstan) agencies, is the organizer of the English
              debates. The Agency's main activity is conferment of credit ratings
              to the banks, as well as their debt instruments, compilation of
              analytical reviews about different signets of the financial market.

              http://www.arminfo.info


              "KAMURJ 2008" 5th INTERNATIONAL ECONOMIC FORUM OPENS IN TSAKHKADZOR

              YEREVAN, FEBRUARY 17, NOYAN TAPAN. The 5th international economic forum
              "Kamurj 2008" ("Bridge 2008") with the participation of about 300
              participants from seven countries opened in Tsakhkadzor on February 16.

              The plenary sitting of the forum was dedicated to the subject
              "International Economic Cooperation. Priorities, Trends, Dominating
              Power". Prior to giving a report on prospects of Armenia's economic
              development, the RA minister of trade and economic development Nerses
              Yeritsian proposed that "Kamurj 2009" be dedicated to issues of
              increasing the competitiveness of our country in the world economy. In
              his words, the forum is organized at a high level, due to which
              "Kamurj" is associated with world econimic forums held in Davos
              (Switzerland). Speeches were made by Sergei Petrov, deputy governor of
              Stara Zagora region (Bulgaria), Yan Visner, chairman of the Union of
              Czech and Moravian Production Cooperatives (UCMPC), Vladislav Ashmarin,
              head of the innovation activity department of the Moscow government,
              Anahit Simonian, head of the United Nations Industrial Development
              Organization (UNIDO) programs in Armenia, and Nikolay Murashov, head of
              the department of industry (Kaliningrad region) of the RF ministry of
              economy. The speakers presented the structures headed by them and
              addressed the opportunities of cooperation with them.

              At the conclusion of the plenary sitting, the chairman of the Union of
              Manufacturers and Businessmen (Employers) of Armenia (UMBA) Arsen
              Ghazarian handed a gold medal of the union to Norayr Nazinian, director
              of "Master" internation integration assistance center, an organizer of
              "Kamurj," for the center's contribution to development of economic
              links between Armenia and foreign countries, implementation of
              investment programs and assistance to Armenian enterprises and on the
              occasion of the 5th anniversary of "Master". Besides, the chairmen of
              UMBA and UCMPC signed an agreement on cooperation between these unions.

              The participants of "Kamurj 2008" continued their work at the round
              tables on the following subjects: "Armenia as a Financial Center",
              "Small and Medium Business. Prerequisites for Development", "Transport
              and Logistics. Problems and Prospects". The conference "Investment
              Attractiveness of the Region. Competitiveness, Diversification and
              Efficiency" took place. Round tables on the subjects "Information
              Society, Past and Present. Development Strategy of Information and
              Communication Technologies" and "Construction Industry. Definition of
              Processes and Methods, Development Prospects" will be held on the last
              day of the forum - February 17.

              The UMBA and the international integration assistance center "Master"
              are the organizers of "Kamurj 2008". The event is being held with the
              assistance of the RA ministry of trade and economic development, the RA
              foreign ministry, the Central Bank of Armenia and the Armenian
              Development Agency.

              http://www.nt.am/news.php?p=1&c=e&t=...angID=1#109704
              http://www.gab-ibn.com/IMG/pdf/Ar21-...sakhkadzor.pdf
              Last edited by Siamanto; 06-11-2008, 08:56 PM.
              What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

              Comment


              • Re: Armenia's Economic Pulse

                Armenia's Financial System
                Part III - Volume of Assets and Weight In Armenia's Economy


                Assets Of The Commercial Banks
                OVERALL BALANCE CAPITAL OF ARMENIAN COMMERCIAL BANKS GROWS BY 43% IN 2007

                Noyan Tapan
                Jan 31, 2008

                YEREVAN, JANUARY 31, NOYAN TAPAN. As of December 31, 2007, 22
                commercial banks with 347 branches operated in Armenia. According to
                data of the Central Bank of Armenia (CBA), as of the indicated date
                the actual authorized capital of these banks made 116 bln 486 mln
                544 thousand drams (over 340 mln 524 thousand USD), growing by 45.4%
                in a year and by 18.4% in the fourth quarter of 2007. The overall
                balance capital of the banks made 171 bln 813 mln 689 thousand drams
                as of December 31, 2007, growing by 43% in a year and by 15.8% in
                the fourth quarter of 2007.

                The overall liabilities of Armenian commercial banks amounted to
                592 bln 576 mln 251 thousand drams as of December 31, 2007, growing
                by 46.6% in a year and by 14.9% in the fourth quarter of 2007. The
                same indices with respect to overall assets made 764 bln 389 mln 939
                thousand drams, 45.7% and 15.1%.

                As of December 31, 2007, standard credist and debts made up 97.6%
                of the commercial banks' overall credits and bill receivable of a
                total of 480 bln 300 mln 286 thousand drams.

                The total amount of credits, deposits, sums provided by leasing and
                factoring by banks to residents made 434 bln 461 mln 634 thousand drams
                as of December 31, 2007, growing by 78.5% in a year and by 16.1% in
                the fourth quarter of 2007. Sums of 56 bln 267 mln 153 thousand drams
                were allocated to industry, they grew by 43.3% in a year and by 2.8%
                in the fourth quarter of 2007; sums of 22 bln 374 mln 428 thousand
                drams were allocated to agriculture, they increased by 57.6% in a year
                and by 17.8% in the 4th quarter of 2007; the same indices with respect
                to construction made 22 bln 33 mln 520 thousand drams, 90.9% and 26.7%
                respectively; the indices with respect to transport and communication
                made 5 bln 848 mln 986 thousand drams, 49.3% and 32.6% respectively.

                Sums provided by Armenian banks to the trade sector in 2007 made 86
                bln 791 mln 176 thousand drams, growing by 75.1% in a year and by
                14.9% in the 4th quarter of 2007. Sums of 22 bln 298 mln 105 thousand
                drams were provided to the financial sector of the economy, they grew
                by 45.4% in a year and by 7.2% in the 4th quarter of 2007. Consumer
                credits amounted to 123 bln 606 mln 735 thousand drams, growing by
                80.7% in a year and by 19.9% in the 4th quarter of 2007. The same
                indices with respect to mortgage crediting made 53 bln 367 mln 307
                thousand drams, 124.5% and 16.1%; the indices with respect to other
                sectors made 41 bln 874 mln 224 thousand drams, 140.2% and 38.1%.

                As of December 31, 2007, the gross incomes of the commercial banks
                made 114 bln 222 mln 447 thousand drams - against 86 bln 511 mln 114
                thousand drams as of the same date in 2006. As of the indicated dates,
                the gross expenditures made 87 bln 738 mln 734 thousand drams and
                65 bln 470 mln 356 thousand drams respectively; the net profit - 21
                bln 98 mln 710 thousand drams and 16 bln 870 mln 490 thousand drams,
                the undistributed profit - 21 bln 43 mln 710 thousand drams and 16
                bln 290 mln 499 thousand drams respectively.

                http://www.nt.am/news.php?p=0&c=0&t=...angID=1#109045

                Assets Of The Credit Organizations
                OVERALL BALANCE CAPITAL OF ARMENIAN CREDIT ORGANIZATIONS GROWS BY 47.6% IN 2007

                YEREVAN, FEBRUARY 1, NOYAN TAPAN. 21 credit organizations operated in
                Armenia as of December 31, 2007. According to data of the Central Bank
                of Armenia (CBA), actual authorized capital of these credit
                organizations made 10 bln 935 mln 620 thousand drams (over 31 mln 968
                thousand USD) as of the indicated date, growing by 30.4% in a year and
                by 10.7% in the 4th quarter of 2007. The overall balance capital of
                credit organizations made 12 bln 485 mln 834 thousand drams as of
                December 31, 2007, growing by 47.6% in a year and by 13.8% in the 4th
                quarter of 2007.

                Overall liabilities of Armenian credit organizations amounted to 30 bln

                889 mln 496 thousand drams as of December 31, 2007, growing by 154.6%
                in a year and by 11.6% in the 4th quarter of 2007. The same indices
                with respect to overall assets made 43 bln 375 mln 330 thousand drams,
                110.7% and 12.2%.

                Standard credits and debts made up 98.2% of the credit organizations'
                overall credits and bills receivable of a total of 42 bln 405 mln 210
                thousand drams as of December 31, 2007.

                The total amount of credits, deposits, sums provided on leasing and
                factoring by credit organizations to residents made 39 bln 589 mln 547
                thousand drams as of December 31, 2007, increasing by 129.6% in a year
                and by 12.9% in the 4th quarter of 2007. 4 bln 562 mln 656 thousand
                drams, which was allocated to industry, grew by 106.8% in a year and by

                5.4% in the 4th quarter of 2007; sums of 3 bln 838 mln 987 thousand
                drams allocated to agriculture grew by 63.1% in a year and by 22.7% in
                the 4th quarter of 2007; the same indices with respect to construction
                made 1 bln 883 mln 456 thousand drams, 629.5% and 4.6% respectively;
                the indices with respect to transport and communication made 1 bln 580
                mln 953 thousand drams, 93.6% and 15.1%.

                Sums allocated by the Armenian credit organizations to the trade sector

                made 7 bln 481 mln 221 thousand drams, growing by 83.8% in a year,
                declining by 8.5% in the 4th quarter of 2007. 1 bln 237 mln 561
                thousand drams was allocated to the financial sector of the economy,
                this sum grew by 14.2% in a year and by 81.4% in the 4th quarter of
                2007. Consumer credits amounted to 7 bln 62 mln 322 thousand drams,
                increasing by 132.7% in a year and by 20.2% in the 4th quarter of 2007.

                The same indices with respect to mortgage crediting made 4 bln 563 mln
                706 thousand drams, 187.4% and 13.6% respectively; the same indices
                with respect to other sectors made 7 bln 378 mln 685 thousand drams,
                303.1% and 29.8%.

                Gross incomes of the credit organizations made 8 bln 929 mln 394
                thousand drams as of December 31, 2007 - against 3 bln 400 mln 885
                thousand drams as of the same date in 2006. As of the indicated dates,
                their gross expenditures made 6 bln 694 mln 158 thousand drams and 3
                bln 128 mln 229 thousand drams, net and undistributed profits - 1 bln
                816 mln 497 thousand drams and 102 mln 972 thousand drams respectively.

                http://www.nt.am/news.php?p=0&c=0&t=...angID=1#109114



                Source Of The Assets
                BALANCE OF POPULATION'S DEPOSITS WITH ARMENIAN BANKS GROWS BY 41.9% IN A YEAR

                Noyan Tapan
                Jan 31, 2008

                YEREVAN, JANUARY 31, NOYAN TAPAN. As of December 31, 2007, the
                monetary base made 427 bln 118 mln drams (about 1 bln 248.6 mln USD)
                in Armenia, growing by 53 bln 55 mln drams or 14.2% as compared with
                the previous month.

                According to preliminary data transferred by the Central Bank of
                Armenia to the RA National Statistical Service, broad money made 691
                bln 343 mln drams as of December 31, 2007, growing by 39 bln 709 mln
                drams or 6.1% as compared with the previous month.

                The balance of the population's deposits with banks made 173 bln 45
                mln drams as of December 31, 2007, growing by 10 bln 519 mln drams
                or 6.5% as compared with the previous month and by 51 bln 124 mln
                drams or 41.9% in a year.

                http://www.nt.am/news.php?p=0&c=0&t=...angID=1#109058
                ARMENIA BANKING SYSTEM TO KEEP ATTRACTING FOREIGN FINANCIAL MEANS

                ARKA
                April 8, 2008

                YEREVAN, April 8. /ARKA/. Armenia banking system is to keep attracting
                financial means from the outside, David Sargsyan, chief of Armenian
                Central Bank's unit in charge of financial system policy, said Tuesday
                on Public Television.

                He said 80-percent growth of industrial and consumer crediting was
                recorded in Armenia in 2007.

                "It is natural that banks have to obtain necessary financial means
                to provide due supply for growing demand. Foreign countries are one
                of financial sources", he said.

                Sargsyan said that now foreign investments make not a big part of
                the financial means attracted by Armenian banks.

                In his opinion, if they grow to 30 or 40%, risks will grow as well.

                Sargsyan said that recent financial crisis in world markets has
                stricken Armenia not so hard, because outside financial means are
                little here.

                He thinks the key source of the banks resources will be domestic
                economy.

                He said Armenian banks' aggregate assets total $2.5 billion while
                $1.5bln to 2bln of foreign currency is now in circulation out of banks.

                "The country faces problem how to attract them to banking system",
                Sargsyan said.

                According to ARKA News Agency's data, financial means attracted from
                non-residents totaled AMD 151.6 billion ($498.2 million) by late 2007.

                It means non-residents' means made 26.83% of all resources attracted
                by Armenian banks by late 2007 against 18.61% earlier that year.

                http://www.arka.am/eng/banks/2008/04/09/8892.html



                How Do They Compare To Other CIS Banks?
                HULIQ (press release), NC
                June 6 2008

                All Banks of Armenia in CIS Top 1000 List

                All of the banks from Armenia are included in the list of top 1000
                CIS banks, according to the volume of assets: a successful step by
                Armenia that aims to make the country top financial center in the near
                future bridging between Middle Eastern and European financial centers.

                Following the results of 2007, all Armenian banks were included in the
                list of 1000 CIS banks, according to the volume of assets.

                Mediamax reports that the list of 1000 banks of CIS as to the volume
                of assets is composed by the `Interfax-CEA' Agency.

                `HSBC Bank Armenia' occupied the 272nd place in the list, assets -
                $343mln.

                Then come:

                `Ardshininvestbank' occupied the 294th place, assets - $308,1mln;
                `ACBA-Credit Agricole Bank' - 330th place, assets - $263,7mln;
                `VTB-Armenia Bank' - 364th place, assets - $230,1mln;
                `Converse Bank' - 408th place, assets - $192,9mln;
                `Armeconombank' - 458th place, assets - $165,6mln;
                `Unibank' - 488th place, assets - $149,7mln;
                `Inecobank' - 564th place, assets - $117,5mln;
                `Armbusinessbank' - 585th place, assets - $108,9mln;
                `Anelik Bank' - 601st place, assets - $105,5mln;
                `ARARATBANK' - 648th place, assets -$91,1mln;
                `Artsakhbank' - 734th place, assets - $73,3mln;
                `Armswissbank' - 743rd place, assets - $71,1mln;
                `Areximbank' - 757th place, assets - $ 68,4mln;
                `BTA-Invest Bank' - 813th place, assets - $58,7mln;
                `Armenian Development Bank' - 903rd place, assets - $45,9mln;
                `Prometey Bank' - 908th place, assets - $44,0mln;
                `Mellat Bank' - 923rd place, assets - $37,1mln;
                `Cascade Bank' - 926th place, assets - $36,0mln;
                `Armimpexbank' - 935th place, assets - $33,2mln;
                `ProCredit Bank' - 960th place, assets - $21,9mln;
                `Byblos Bank Armenia' - 965th place, assets - $19,3mln.

                Source: By Mediamax

                http://www.huliq.com/61233/all-banks...-top-1000-list



                What Is The Weight of The Sector In The Armenian Economy?
                7 commercial banks of Armenia included in list of 100 largest tax payers of Armenia

                2008-02-01 19:17:00

                ArmInfo. 7 commercial banks of Armenia were included in the list of 100

                largest taxpayers of the country according to the 2007 results.
                According to the data of the State Tax Service of the Republic of
                Armenia, HSBC Bank Armenia became the first bank in the mentioned list
                by the volume of taxes paid in 2007. Having paid taxes worth a total of

                1,618 bln AMD, 1,475 bln AMD of which were tax on profit and income
                tax, it occupied the 31st place in the top 100. It is followed by
                ACBA-Credit Agricole Bank, which paid 1,090bln AMD, 1,054bln AMD of
                which were tax on profit and income tax and occupied the 57th place in
                the top 100. Ardshininvest bank supplemented the budget by 922,3mln AMD

                in 2007, including 854,3mnl AMD - tax on profit and income tax, thus
                occupying the 65th place.

                Armeconombank, which paid 877.3 mln AMD, 800.9 mln AMD of them being
                profit and income taxes, ranks next and holds the 70th position. VTB
                Bank (Armenia) holds the 91st position on the list of hundred largest
                tax-payers in Armenia, having paid 635.6 bln AMD to the state budget in

                2007, 585.3 mln AMD of them being profit and income taxes. INECOBANK
                holds the 95th position, having paid 570.7 mln AMD, 561.6 mln AMD of
                them being profit and income taxes. Unibank closes the list of the
                banks which entered the top hundred of Armenian tax-payers. The bank
                paid 567.3 mln AMD to the state budget, 546.9 mln AMD being profit and
                income taxes. As of December 31, 2007, there were 22 commercial banks
                in Armenia.

                http://www.arminfo.info
                What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

                Comment


                • Re: Armenia's Economic Pulse

                  Armenia's Financial System
                  Part IV - Informational Resources


                  Basic Information: ArmenianBanks.com



                  Banker.am
                  FIRST 100 DAYS OF BANKER.AM PROVES SUCCESS

                  ARKA
                  May 20, 2008

                  YEREVAN, May 20. /ARKA/. The first hundred days of the newly launched
                  Banker.am portal came to prove its necessity for Armenian society. The
                  originators of the project say the slogan of the portal "www.Banker.am
                  - the real banking sector" became a reality.

                  Survey shows that the site is among ten most visited sites in business,
                  finances and career categories.

                  Banker.am, founded in February, 2008, is an informational, analytical,
                  scientific, consulting, and educational website also offering, jobs
                  contests and entertainment.

                  Banking and financial news, description of the participants of
                  Armenia's financial and banking sectors, information on their services
                  and an interactive banking map, as well as the results of various
                  surveys carried out among specialists and people, economic forecasts,
                  and other related information can be found on the website. The visitor
                  can also read the opinion of bankers, professional consulting and
                  find vacancies.

                  Soon visitors will be able to submit requests for different banking
                  services and get offers from the banks and credit institutions choose
                  the one that fits their needs most.

                  A virtual game will soon be placed on the website. Any visitor may
                  create his own virtual bank and compete with others on Armenian market.

                  Among information partners of the project are ARKA News Agency,
                  Novosti-Armenia Agency, the Smart Systems Company, GIS info, Ararat
                  Magazine, "We about Us" Magazine, USAID, and Global SPC.

                  http://www.arka.am/eng/banks/2008/05/21/9486.htm



                  ARKA News Agency Indicators
                  ARKA AGENCY PUBLISHES QUARTERLY BULLETIN ON ARMENIAN BANKS' INDICATORS BY END OF Q1 2008

                  ARKA
                  May 12, 2008

                  YEREVAN, May 12. /ARKA/. The ARKA News Agency has published its
                  quarterly bulletin on Armenian banks' performance indicators recorded
                  by the end of the first quarter 2008.

                  The bulletin is based on banks' financial reports published in the
                  press, as well as on additional information provided by the banks.

                  The "Performance indicators of Armenian banks" bulletin includes about
                  80 pages of tables and ten sections dealing with the banking system -
                  1. General description of banks, 2.Assets, 3. Liabilities, 4. Asset
                  and liability transactions of banks with non-residents 5. Capital, 6.

                  Profit/Losses, 7. Money flow information 8. Liquidity and
                  capitalization level 9. Risk norms and 10. Bank profitability and
                  yield indicators.

                  The information contained in the bulletin is sufficient for forming an
                  idea of the financial state of Armenia's banks and making a comparative
                  analysis of their performance.

                  The ARKA News Agency founded on May 1 1996 specializes in financial,
                  economic and political information. ARKA started publishing the
                  bulletin "Credit organizations of Armenia" is 1999 and the quarterly
                  bulletin "Financial indicators of banks" in May 2006. The bulletins
                  are based on independent annual audits.

                  http://www.arka.am/eng/banks/2008/05/12/9373.html



                  ARKA News Agency Press-Rating

                  CONVERSE BANK, ACBA-CREDIT AGRICOLE, ARARATBANK, ARDSHININVESTBANK, ARMECONOMBANK ARE LEADERS OF ARKA'S 4TH QUARTERLY PRESS-RATING

                  ARKA
                  March 13, 2008

                  YEREVAN, March 13. /ARKA/. The Converse Bank, ACBA-Credit Agricole
                  Bank, Araratbank, Ardshininvestbank and Armeconombank are the top
                  five leaders of ARKA's fourth quarterly press-rating in 2007.

                  The Armenian press was active in covering activities of Armenian
                  banks in October-December 2007 (214.4% increase compared with the
                  corresponding period in 2006). The share of negative press-signals
                  was 3.4% in 2007 against 4.4% in the reporting period.

                  The increase of information on the following headings was as follows:
                  General (from 38.7% to 49.8%), Banking Activities in Figures
                  (15.5%-17%), Customers and Service (3.7%-5.1%), Banks' Economic
                  Forecasts and Opinions (5.9%-6.5%).

                  The share of the heading Bank Development Policy decreased from 26.2%
                  to 21.6% in the period under review.

                  In general, information on banks increased in the fourth quarterly
                  period of 2007.

                  In the reporting period, the ACBA-Credit Agricole Bank was the
                  leader on two out of five main headings: General (with 104.96 index),
                  Customers and Service (with 40.96 index). The Converse Bank was the
                  most active in reporting information about the Bank Development Policy
                  (with 251.16 index) and Banks' Economic Forecasts and Opinions (with
                  23.04 index).

                  The Ardshininvestbank ranked first in covering information about the
                  Banking Activities in Figures (with 99.97 index).

                  Six banks covered information on the above-mentioned headings in the
                  fourth quarterly period of 2007 against five banks in the corresponding
                  period in 2006.

                  The press-rating of the ARKA News Agency is based on the
                  financial-economic indicators of Armenian banks and media coverage
                  of banking activities. ARKA believes the more active is the press
                  coverage of the banks, the more effective are banking activities.

                  The subject of the ARKA News Agency's analysis is the actual
                  information on banks, not advertisement.

                  For a more detailed analysis of banking activities in the fourth
                  quarterly period of 2007, read the Press-Rating of Banks, Issue #09
                  (36).



                  Global Ranking Agencies
                  ARKA News Agency, Armenia
                  Jan 11 2008


                  Fitch ratings assigns rating `BB' forecast `Stable' to Armenia's `Akba-Credit Agricole Bank


                  YEREVAN, January 11. /ARKA/. Fitch Ratings international ratings
                  agency gave Armenia's `AKBA-Credit Agricole Bank' long-term issuer
                  default rating `BB' forecast `Stable', short-term issuer default
                  rating `B', individual rating `D' and support rating `3', reports the
                  official site of `Fitch Ratings'.

                  According to the report, the ratings of the Armenian bank reflect
                  moderate probability of receiving support, if needed, from the
                  biggest shareholder Credit Agricole S.A. French group (with long-term
                  issuer default rating `AA', forecast `Stable').

                  According to Fitch, even through the Credit Agricole S.A. group owns
                  the smaller package of the Armenia bank's shares (28%), still it can
                  provide support to `AKBA-Credit Agricole Bank' if needed bearing in
                  mind associating the brands, and active involvement of the group in
                  creating and monitoring of the bank that has not much grown yet. Yet,
                  Fitch stress that the minor package of the group and low priority of
                  the Armenian market may reduce the probability of receiving support.

                  The agency also pointed out a limited probability of receiving
                  support from the Armenian authorities if needed as the bank controls
                  considerable segment in agricultural lending (Armenia has long-term
                  `BB-`, `positive' forecast issuer default ratings both in foreign and
                  national currency).

                  Individual rating reflects small scale of `AKBA-Credit Agricole Bank'
                  as per the international standards, high risks of operation
                  environment, rapid growth of the bank's assets and large share of
                  lending in foreign currency. At the same time, Fitch says, the rating
                  takes into account good quality of AKBA management, considerable
                  client database in Armenia, high profitability from the main
                  activities, traditionally good quality of assets, strong
                  capitalization and adequate liquidity position.
                  According to the Fitch report, the potential for improving the bank's
                  long-term issuer default rating is limited and is possible only if
                  the share of the Credit Agricole S.A. group in the Armenian bank is
                  increased and/or if the group gives respective assurance of its
                  willingness to support the bank if needed.

                  Raising the country ceiling of Armenia from the current `BB' level
                  would also be a requirement for improving the long-term issuer
                  default rating of `AKBA Credit-Agricole Bank', Fitch says.
                  The long-term issuer default rating may be downgraded if Fitch
                  changes its opinion on the willingness of Credit Agricole S.A. group
                  to support `AKBA-Credit Agricole Bank' or if Armenia's country
                  ceiling is lowered (which is not expected taking into account the
                  current `Positive' forecast by sovereign ratings).

                  The potential for improving the individual rating of `AKBA-Credit
                  Agricole Bank' is currently limited due to small size of the bank and
                  high operation risks in Armenia. Yet, according to the rating agency,
                  further successful expansion of the client database, along with
                  maintaining the quality of assets and adequate capitalization, may be
                  a positive factor in the credit rating.
                  According to Fitch, considerable losses in credits may be a potential
                  reason for lowering the rating, but currently the bank has
                  considerable `reserve' of own means to absorb such losses.

                  `AKBA-Credit Agricole Bank' closed joint stock company is the third
                  biggest bank of Armenia in value of assets and lending volume. As of
                  the end of the 3rd quarter of 2007 the bank's share on these
                  indicators was 10% and 12% respectively. Apart from that, the bank
                  was the leader in the rural lending segment (70% of the market). AKBA
                  has 21 branches in Armenia; the number of the branches is expected to
                  reach 47 by the end of 2009.

                  `AKBA-Credit Agricole Bank' closed joint stock company (former Farmer
                  Mutual Support Bank of Armenia) was founded in 1995 and was
                  registered on March 29 1996. The bank was founded within the EU TACIS
                  program.
                  In September 2006 Credit Agricole French banking group purchased 28%
                  of the bank's shares. The remaining shares belong to 10 associations
                  of farmer mutual support involving over 45,000 farmers.

                  According to the official information, as of the end of September
                  2007, the total capital of `AKBA-Credit Agricole Bank' was 20.4bln
                  Drams, total assets were 68.9bln Drams, balance sheet profit - 3.7bln
                  Drams and profit was 2.3bln Drams by the end of January-September
                  2007 period. ($1=307.15Drams).

                  http://www.arka.am/eng/banks/2008/01/11/7680.html

                  The Rating Agency AmRating/GlobalRating has issued a new report on the Armenian Banking System Transparency. Attractiveness. Funding Scarcity.


                  2008-01-28 14:46:00


                  ArmInfo. The Rating Agency AmRating/GlobalRating has issued a new
                  report on the Armenian Banking System Transparency. Attractiveness.
                  Funding Scarcity.

                  GlobalRating Group press-service reports AmRating states that the
                  Armenian banking system is in an intensive development phase and has
                  drawn a lot of attention from foreign investors. Developed legislature,
                  strict prudential regulation, increasing competition and scarcity of
                  resources are conducive to the development of good corporate governance
                  standards, the accumulation of management experience, lowering
                  corruption and lower non-financial risks. Because of the strict
                  prudential monitoring and regulation by the Central Bank of Armenia,
                  commercial banks are in line with recent international trends and
                  moving towards Basel II standards. Liquidity and capital adequacy
                  measures are quite high, and the percentage of officially overdue loans
                  on the books is insignificant.

                  "The low politicization of the Armenian banking system is a positive
                  development. Its exposure to political risk is minimal, making banks
                  comparatively immune to potential shifts in the power structure,
                  lowering the overall country risk,''- said Executive Director Emmanuel
                  Mkrtchyan.

                  Despite the fact that most of the recent investors in the market for
                  banking services have been members of the Armenian Diaspora (both pre-
                  and post-Soviet waves) who carry little weight in political circles,
                  new non-resident institutional investors who may have specific
                  strategic goals are entering the market.

                  Interest from foreign investors in the controlling banks' stakes raises
                  questions as to whether Armenia's banking system will remain "national"
                  in character or will be controlled by foreign strategic investors.

                  In order to avoid the latter under conditions of scarcity of funding
                  resources, the regulator's idea of attracting capital by entering DPOs
                  and then IPOs is gaining momentum.

                  Analysts at AmRating/GlobalRating recognise the main development
                  strategies for the Armenian banking system in general and commercial
                  banks in particular as: 1. Increased capitalization. 2. Solving the
                  problem of a scarcity of long-term resources. 3. Preparation for the
                  gradual transition towards Basel II principles. 4. Expanding the range
                  of offered services. 5. Regional Expansion

                  The Global Rating Group - a family of rating agencies. The rating
                  agencies RusRating (Russia), KzRating (Kazakhstan) and AmRating
                  (Armenia) were created by Richard Hainsworth and have been brought
                  together in the Global Rating Group. In the near future the group plans
                  to add national rating agencies in Azerbaijan (AzeriRating), Ukraine
                  (Ua-Rating) and other CIS regions.

                  The primary goal of the Global Rating Group is to establish a network
                  of national rating agencies across the CIS, promoting national brands
                  and strengthening the market position of each agency in its own country
                  and the international community.

                  http://arminfo.info
                  What if I find someone else when looking for you? My soul shivers as the idea invades my mind.

                  Comment


                  • Re: Armenia's Economic Pulse

                    Selon la FRA l’Arménie peut financer la construction d’un chemin de fer entre l’Iran et l’Arménie

                    samedi13 septembre 2008, par Stéphane/armenews

                    L’Arménie peut financer la construction d’un chemin de fer connectant le pays avec l’Iran sur le budget de l’état, a déclaré le membre du Bureau de la FRA Dashnaktsutiun Vahan Hovhannisyan.

                    « Nous devons trouver 1 milliards de drams pour la construction de la voie » a-t-il dit lors d’une conférence de presse.

                    Selon lui, le nouveau chemin de fer aidera à éviter la dépendance de l’Arménie en matière de transport vis-à-vis de la Géorgie qui est la seule voie actuelle permettant de connecterle pays avec le monde extérieur.

                    Récemment le ministre arménien des Transports et des Communications Gurgen Sargsyan avait annoncé que le Président Serge Sarkissian avait crée une commission pour étudier la question de la construction d’une voie de chemin de fer entre l’Arménie et l’Iran.

                    La Commission doit choisir le meilleur projet des trois projets disponibles. Selon les évaluations préliminaires, le plus avantageux est l’itinéraire Gagarin - Gavar - Martuni - Jermuk qui est le chemin le plus court pour aller aussi à Vanadzor et ensuite en Géorgie.

                    From http://www.armenews.com/article.php3?id_article=44240

                    ---------------------

                    For those who don't know French, Google translate:

                    Armenia may finance the construction of a railway connecting the country with Iran on the state budget, said the Bureau member of the FRA Dashnaktsutiun Vahan Hovhannisyan.

                    "We have to find 1 billion drams for the construction of the track," he said at a press conference.

                    According to him, the new railway will help to avoid dependence on Armenia's transport vis-à-vis Georgia which is the only current path to connecterle country with the outside world.

                    Recently, the Armenian Minister of Transport and Communications Gurgen Sargsyan announced that President Serge Sarkissian had created a commission to study the issue of construction of a railway line between Armenia and Iran.

                    The Commission must choose the best project of the three projects available. According to preliminary assessments, it is more advantageous route Gagarin - Gavar - Martuni - Jermuk which is the shortest way to go also in Vanadzor and then in Georgia.
                    Azerbaboon: 9.000 Google hits and counting!

                    Comment


                    • Re: Armenia's Economic Pulse

                      Greece helps farmers of Armenia in the region of Tavoush

                      The Greek government, through the Fund for International Development Greece, has made farmers happy in Armenia. In the region of Tavoush north of Armenia, farmers in eight communes now have a refrigeration room with a capacity of 200 tons with all equipment needed for its use. In addition, several tractors are part of the aid of Greece to Armenia. This equipment will enable the region to develop Tavoush benefit agriculture and the cultivation of the vine. With a large capacity storage reason other fruit harvested. The FRA Dashnaktsoutioun of Greece which contributes greatly to the development of Armenian-Greek relations is behind this achievement of the Greek government.

                      Originally in French
                      http://www.armenews.com/article.php3?id_article=44838
                      Azerbaboon: 9.000 Google hits and counting!

                      Comment

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