YEREVAN, March 31. /ARKA/. Samvel Chzmachyan, chairman of the Union of Banks of Armenia, finds it wrong to demand banks to convert the loans extended in foreign currencies into dram loans, especially by using administrative levers.

In an interview with Golos Armenii Newspaper, he said that to demand this means to jeopardize the country's financial and banking sector.

“I would recommend all those who make a habit to come up with populist initiatives and remarks related to banks and their private business activities to consider banks not as objects from which it is necessary to extract something, but as entities that accumulate savings of dozens and hundreds of thousands individual and corporate clients, which not only keep the clients' savings, but also multiply them,” he said in his interview.

Chzmachyan said that the majority of borrowers of foreign currency loans are not low-income clients, and they took mortgage loans after the previous crisis in 2008 and 2009, i.e. they have already seen how the dram plummeted at once, but have decided to run such a risk.

Today only few foreign currency borrowers face real problems amid devaluation of the national currency, he said, but banks voluntarily negotiate with them and soften lending terms, if possible, for example, prolonging repayment terms or transforming the foreign currency loans into dram loans.

Chzmachyan is convinced that the usage of frontal support mechanisms by converting foreign currency loans into dram loans at a so-called preferential rate will lead to the necessity of complete converting and inflict heavy losses on banks.

“If the government wants to ease the borrowers' burden, it should do this not at the account of private commercial banks, but by making subsidies from the government budget,” Chzmachyan is quoted by the newspaper as saying. ---0-----