YEREVAN, February 13. /ARKA/. The Central Bank of Armenia has not yet received an official application and has not given its preliminary consent to the acquisition of HSBC Bank Armenia by Ardshinbank, the regulator said in response to ARKA news agency’s inquiry.
Ardshinbank announced the deal on February 6 this year, saying it had reached an agreement with HSBC Europe B.V, a subsidiary of HSBC Holdings plc, to acquire its subsidiary HSBC Bank Armenia.
The merger was said to be aimed at increasing Ardshinbank’s high-quality client base and highly skilled team of client managers and employees. In its turn, HSBC Bank Armenia said that the decision was made to redistribute capital in global directions.
At the same time, the Central Bank noted that “the acquisition of a bank by another bank is a normal process, and such cases have happened many times in the financial system”.
When asked whether this decision is conditioned by the fact that Armenia is no longer interesting for systemic banks, and HSBC group in particular, from the point of view of banking business, the Central Bank said that it cannot comment on the decision of HSBC Holding plc.
The Central Bank emphasized that HSBC Bank Armenia has always had a positive impact on the banking system of the country since the day it was founded, bringing the best global experience and training local specialists.
“And although the world has become much more globally accessible both in terms of sharing international experience and skilled professionals, the Central Bank believes that the presence of global brands in the local market can only have a positive impact on the development of the financial system,” the regulator’s press service noted in response to a question about how the departure of one of the world’s largest financial conglomerates will affect the Armenian banking system.
As to whether new mergers or acquisitions of banks are expected this year, the press service said that the Central Bank will always properly inform the consumers of financial services about important developments in the financial system within the framework of its powers.
The deal between HSBC Bank Armenia and Ardshinbank is subject to regulatory and antitrust approvals and is expected to be finalized within the next 12 months.
HSBC Bank Armenia’s assets as of December 31, 2023, stood at about AMD 290 billion. Its loan portfolio amounted to about AMD 185 billion and customer deposits were worth about AMD 200 billion.
Ardshinbank was the most profitable bank in Armenia in 2023. The bank’s net profit amounted to AMD 62.7 billion, against a profit of AMD 62.2 billion in 2022. HSBC Bank Armenia ranked 8th in terms of profit with AMD 11.05 bln in 2023 (37.86% growth compared to 2022).
Ardshinbank’s assets at the end of December 2023 amounted to AMD 1.6 trillion (4.9% growth against 2022 ), the liabilities stood at AMD 1.4 trillion (2.17% growth) and its total capital stood at AMD 191.3 billion (31.5% growth) -0-
