Armenia’s banking system getting immersed in debts

Armenia’s banking system is at rapid paces getting immersed in debts due to increasing loans borrowed from foreign trade banks and financial institutions, Haykakan zhamanak has learned.

Citing the Central Bank, it says that in the last quarter of 2014 alone, the country’s debts to international financial institutions increased by about $225 million to $1.412 billion. The figure, according to the paper, is striking in that the banks’ external debts fluctuated between $1-1.2 billion in the past couple of years, with the sharp increase being observed only after the national currency’s depreciation at the end of the year. The paper says that the banks probably attracted loans not in order to expand their activities but rather, for the purpose of mitigating the problems caused by the Dram’s depreciation.