YEREVAN, October 26. / ARKA /. Commercial banks of Armenia positively evaluate the introduction of CBA’s special economic norms on foreign exchange position and consider it timely.

The regulation of the Central Bank was not a surprise for the banks. The issue had been discussed several times by the Union of Banks of Armenia, and the bankers reacted to it with an approval. Note that on October 20 the Central Bank of Armenia decided to establish a special economic standard on currency positions for banks of Armenia for a period of six months.

The ratio includes two components: the maximum ratio between the long term position of the bank for each currency and its total capital, as well as the maximum ratio of total long term positions of the bank for all currencies and its total capital. By the Central Bank’s Council decision, the maximum value of these components is set at 7% and 10% respectively. The ratio will be calculated daily.

The new norm will come into force on October 26, 2009, and the adopted decision by the Central Bank decision will be valid until April 26, 2010. The majority of the Armenian bankers recognize that this decision of the Central Bank limits their actions to implementations by the major transactions in the market; however, such controls did not particularly scare them.

Thus, according to the main dealer of Caskadebank Arsen Sargsyan, the decision is a requirement of time and is intended to stabilize the market. Bank Anelik considers the same thing.

According to the dealer of Armbusinessbank Vahan Melkonyan the established standard can positively influence the currency market. He believes that in that way the Central Bank limits the operation of banks so that they do not engage in major transactions in the market, but only engage in the purchase of currency. "Now the banks will not be able to buy a lot of currency and will be forced to sell it," he said, adding that the standard will have a governing influence on the activities of banks.

It is not excluded that the CBA also decided to limit foreign exchange position of the banks based on the fact that some of them sent the proceeds from the expansionary policy of the Central Bank of cheap money not in the economy but into currency purchase.

Therefore, in order to prevent such "speculation" the Central Bank decided to reintroduce the standard currency position, which was abolished in January 2008. –0-