Economy, Business And Markets

Mellat Bank in Armenia Attracts €10M

Mellat Bank in Armenia Attracts €10MMellat Bank in Armenia Attracts €10M

Mellat Bank branch  in Yerevan has attracted € 10 million after international sanctions on Iran were eased, the executive director of the bank Seyed Gholamreza Mousavi said in an interview with Armenian daily ‘Zhamanak” (Time).

“The lifting of sanctions helped our bank to attract frozen Iranian assets in Armenia and to channel 10 million euros to replenish our capital,” he said.

The bank’s capital in the republic is now 23 billion drams, up from 19.3 billion drams in the first quarter of 2014.

Last year Armenia’s Central Bank said it would raise the minimum amount of commercial banks’ total capital to 30 billion drams (about US$64 million) from the present 5 billion drams, effective from January 2017.  The measure is said to be aimed at encouraging mergers and consolidation of banks, which is expected to create a sound competitive environment and make banking services more accessible.

According to Mousavi, Mellat tries to lend to those sectors of the economy that are involved in production or import and refrains from lending to intermediaries. He said Armenia’s most successful sectors today are transport, tourism and restaurant business.

“We are trying to integrate fully into Armenia’s banking system, but there are deals we refrain from, despite their apparent profitability. Basically, we do not provide loans with high interest rates, for example, at 24-30%,” he said.

Mellat Bank has been operating in Armenia since 1996. Its clients are mainly small and medium-sized enterprises involved in trade between Armenia and Iran, as well as Iranian and Armenian tourists and students.