EBRD Purchases 25 Percent Stock in Armenian Bank

Yerevan (Armenpress)–One of Armenia’s leading commercial banks–Armeconombank and the European Bank for Reconstruction and Development (EBRD) sealed an agreement in Yerevan on December 8 whereby the European bank purchased 25 percent of the Armenian bank’s stock.

Speaking after the signing ceremony–a senior EBRD executive said they will pay Armeconombank $1 million and grant it $500,000 in "technical assistance." An EBRD finance director–Maria-Luisa Cicogniani–told a news conference that the agreement was in line with EBRD’s plans to expand investmen’s in the private sector of former Soviet republics.

"This is our first investment in Armenia’s banking sector–and if further opportunities arise we will certainly consider them," Cicogniani said. EBRD had made similar investmen’s in one bank in Azerbaijan and two banks in Georgia which conform to Western-style management and transparency.

"We are a long-term investor in the bank–and our investmen’s are usually five-year-long and more," she said.

Armeconombank–in which the majority of stock belongs to Khachatur Sukiasian–a business tycoon and parliament member–is one of few Armenian banks structured as a public joint-stock company–with 2,000 small shareholders receiving dividends.

The head of EBRD Yerevan office–Nikolay Hajinsky said the EBRD will soon buy minority stakes in several Armenian manufacturing companies–but he did not name those firms.

The overall EBRD investmen’s in the Armenian economy since 1993 have covered 11 programs totaling $150.

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