Armenia-based banks earn a total of 78 billion drams in profit in 2019

14.02.2020 16:53
Armenia-based  banks earn a total of 78 billion drams in profit in 2019

YEREVAN, February 14. /ARKA/. Seventeen Armenia-based commercial banks earned a total of 78 billion drams in profit in 2019, the executive director of the Union of Banks of Armenia Seyran Sargsyan told reporters on Friday.

He described the past year as quite successful in terms of the profit, saying it saw 25.4% or AMD 15.8 billion growth. According to him, when compared with 2011-2012, when the banks' profit amounted to 39 billion drams, while the return on capital was 11.67%, now with a profit of 78 billion drams, the return on capital was only 9.24%.

"This suggests that, despite the growth in profit and an increase in capital, banks earned less profit than in previous years. It also helps dispel myths about the super-profits of Armenian banks," Sargsyan said.
For his part, the chairman of the Union of Banks of Armenia Mher Abrahamyan noted that a comparison of the profit ratio with capital allows to understand the benefits from the point of view of an investor, for whom investments in the banking sector are almost comparable to any other business and should have a corresponding return.

"Given the very high number of non-residents in the capital of Armenian banks - more than 50%- the return on capital in the form of profit is a very important indicator, and it is not very high," Abrahamyan said, adding that the growth of both capital and profit of banks indicates the effectiveness of the banking system.

In late December 2019, the total capital of Armenia-based commercial banks grew by 73 billion drams or 9.5% from the previous year to 844.8 billion drams, the banks' assets grew by 17% or 842 billion drams to 5.805 trillion drams, the banks' total liabilities amounted to 4.960 trillion drams having increased by 18.3% or 768 billion drams and liabilities to customers increased by 637 billion drams or by 22.4%. ($1 - 479.11 drams). -0-

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