YEREVAN, May 18. /ARKA/. Armenian banks have already forgiven 2.5 billion drams worth loan debts, chairman of the Central Bank Martin Galstyan said on Tuesday, speaking at a meeting of the parliamentary committee on financial and budget issues.

He said the move was dictated by a dramatic drop in population's and business entities' incomes causing problems with repayment of their loans.

According to him, the banks applied a very correct policy revising in many cases the loan terms for some clients and extending repayment for some others. They also lowered interest rate for another group of borrowers demonstrating an individual approach.

"Armenia-based banks have forgiven a total of 2.5 billion drams worth loan debts without receiving financial assistance from the government. The beneficiaries are the soldiers who were killed in the Nagorno-Karabakh war last autumn, those who were wounded or went missing and members of their families,' he said  

He said the Central Bank believes that in 2021 the banks' behavior should be more conservative. "We expected the lending rate to be weaker, but the first quarter figures show that the lending rate is higher than expected,' he said.

According to him, the banks have tightened their lending terms considering a category of clients as more risky.

Galstyan also commented on promises of some political parties to declare loan amnesty in case of wining early parliamentary elections on June 20, saying the main thing is that social policy should not be opposed to existing contractual obligations. -0--