YEREVAN, October 20. /ARKA/. International Finance Corporation, IFC, a member of the World Bank Group, is helping Armenia’s Inecobank engage in interest rate swap transactions, which will help it better manage its interest rate risk to support access to finance for local businesses, the IFC press office reported on Friday.

IFC and Inecobank have signed an International Swaps and Derivatives Association (ISDA) Master Agreement, which allows the bank to hedge the U.S.-dollar interest-rate risk on its outstanding long-term borrowings.

The ISDA Master Agreement is the standard document used to govern over-the-counter derivative transactions.

“This new agreement with IFC will help us better match our asset and liability positions and increase our ability to manage our finances effectively,” Garnik Tadevosyan, Acting Chief Executive Officer of
Inecobank, is quoted in the press release. “We will use this new risk management tool to fix interest rates on our long-term borrowings at favorable levels to create better value propositions for our clients.”

According to the World Economic Forum’s Global Competitiveness Index 2016-2017, access to finance represents the biggest obstacle to doing business in Armenia. As well as helping Inecobank hedge its interest rate risk, the new tool will improve access to long-term finance for its clients, helping them grow and create jobs.

“The agreement with Inecobank, our long-time partner, is part of our strategy to help banks improve their risk management capacity and introduce innovative products that can benefit their clients,” said Jan van Bilsen, IFC Regional Manager for the South Caucasus.

Armenia became an IFC member in 1995. Since then, IFC has provided over $480 million, including nearly $118 million mobilized from other lenders, to finance 49 projects across a range of sectors, including financial markets, manufacturing, agribusiness, services, and mining.

IFC has also supported trade transactions worth more than $130 million through its trade finance program, and implemented advisory projects focused on private sector development. About IFC IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets.

Working with more than 2,000 businesses worldwide, IFC uses its capital, expertise, and influence to create markets and opportunities in developing countries around the world. In FY17, the IFC delivered a record $19.3 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity.

Inecobank cjsc was registered on February 7, 1996.
Inecobank was the first bank in Armenia to start serving trade in installment.

The bank shareholders are Avetis Baloyan, with his 30%, Karen Safaryan with 25.92%, DEG (Deutsche Investititions-und Entwicklunsgesellschaft mbH), a member of KfW Group, with 5.75%, EBRD (European Bank for Reconstruction and Development) with 22.7% and IFC with 4.25%. --0----