Share of non-performing agricultural loans grew to 11 percent

30.05.2016 14:40
Share of non-performing agricultural loans grew to 11 percent

YEREVAN, May 30. /ARKA/. The share of non-performing agricultural loans in 2015 stood at 11%, according to Andranik Grigoryan, the head of Stability and Financial Development unit of the Central Bank of Armenia.

"Non-performing loans in agricultural sector have historically been higher than in other sectors amounting to 11% in 2015. Overall, non-performing loans exceeded 7%,’ he said to ARKA.

He said the ongoing government policy of subsidizing agricultural lending has a positive impact on the repayment of loans. Grigoryan said also that the rise in non-performing loans resulted from negative external factors and the ongoing slowdown in GDP growth.

"The negative impact of external factors such as the slowdown in Armenia’s major partner countries, the downward trend in world prices for non-ferrous metals and the falling remittances from abroad to Armenia have led to a decline in the demand for loans  as well as to a decrease in the level of loan
repayment," he said.

According to the Central Bank’s "Financial Stability Report 2015’, the share of non-performing loans in 2015 increased by 1 percentage point to 7.4%. As of March 2016, non-performing loans stood at 10%. In agriculture, their share grew by 5.9 percentage points to 11.3%, in public and service sector their share grew by 4.3% to 13.8% and in industry they upped by 3.2 percentage points to 9.2%. -0-

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