YEREVAN, October 22. / ARKA /. Problems of Armenian banks result from the overall economic situation in the country, Samvel Chzmachyan, the chairman of the Union of Armenian Banks, said in an interview with the local daily "Zhamanak."

‘The banking system is part of the economic system, and it could not stay away from the current problems and uncertainties,’ he said.

According to Chzmachyan, the banking system, as well as the entire economy is being affected in the first place by the world economy problems.

"Because of the difficult economic situation in Russia, the amount of money transfers from that country has dropped dramatically, which in turn is having a negative impact on the population’s solvency,’ he added.

Another negative factor is the devaluation of the Russian ruble that has created many problems for Armenian exporters and producer, whose solvency is also being affected.

"The population has become insolvent. This increases the amount of non-performing and overdue loans. According to the latest data, non-performing loans amounted to 9.5%,’ he said, adding that to reduce the risks of lending the banks have become more cautious in providing loans.

In the first nine months of 2015 Armenian commercial banks saw their net profits slash by 53.3% year-on-year – from about 13.130 billion drams to about 8.130 billion drams. Seven of 21 banks closed the third quarter with a total loss of 9.9 billion drams. In the first nine months of 2014 six banks posted a total loss of 3.6 billion drams

The banks’ total assets in January-September 2015 fell by 2.1% from the beginning of the year to 3.318.3 trillion drams. Their liabilities declined by 3.6% to 2. 807 trillion drams and their lending fell by 4.3% to 2.074 trillion drams. However, their capital increased by 7.2% to 511.3 billion drams. –0-