World Bank Expert Blasts Armenian Bank OSCE

Yerevan (BBC)–"You have one foreign bank which works in a rather unruly and lazy way. It has been given the best share of the market without any effort"–the World Bank economist Lev Freynkman told journalists–meaning the HSBC-Armenia Bank.

He said that this bank was extremely conservative and financed only one significant project–the Yerevan tobacco enterprise Grand Tobacco.

He is convinced that the Armenian banking system should not fear competition among foreign banks. He said the arrival in Armenia of another major bank would force HSBC-Armenia to intensify its efforts and finance various projects–and local banks would start to imitate it. He recommen’s that a serious German bank–which would be able to strengthen the Armenian banking system–should be attracted.

The World Bank economist believes that the banking system of Armenia accounts for only four per cent of gross domestic product and through its insignificance it has been protected from Russia’s financial shocks. "The Russian crisis touched Armenia less than other CIS countries. The weakness of the Armenian economy has turned out to be an advantage"–Freynkman’said.

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