YEREVAN, November 29. /ARКА/. The share of individual and corporate non-performing loans in the total loan portfolio of 17 Armenia-based commercial banks does not exceed 5%, said Andranik Grigoryan, the head of a Central Bank department overseeing financial stability, when speaking at a parliamentary hearing on credit policy and financial literacy today.
“These are the loans that are overdue for one reason or another, or because of the deterioration of the financial situation of the borrower, they were refinanced – another loan was taken to repay it . The banks must reserve capital for such loans, and this creates certain difficulties,” said Grigoryan .
He specified that the share of non-performing consumer loans is 8%, while the share of non-performing so-called quick loans exceeds 20%.
“This is due to the fact that when a loan is issued quickly, the borrower is not required to produce additional documents such as a certificate about the size of salary, income or property, therefore these loans are assessed as more risky in terms of repayment,” Grigoryan said.
According to the Central Bank of Armenia, in the first half of 2019, the lending to economy stood at 3.389 trillion drams. ($1 – 477.25 drams) .– 0–
