Armenian banks lost AMD 4,7 billion in one day
Armenian banks lost AMD 4,7 billion in one day, CBA Chairman Arthur Javadyan told a news conference, commenting on CBA's return to floating exchange rate policy on Mar. 3.
According to CBA Chairman, banking system was in highly unfavorable situation, as banks were in short foreign currency position, where the bank's foreign currency liabilities exceed its actives.
The reason for such position were expectations formed within 3 months (Dec 2008-Mar 2009) towards foreign currency revaluation and national currency devaluation.
Guided by these expectations, many investors withdrew their dram investments, investing dollars instead. In current circumstances, by the end of 2008 the ratio of dram investments to dollar investments comprised 65% to 35%. Upon CBA selling a certain amount of dollars, the ratio changed in favor of dollar investments, comprising 70%(in dollars) and 30% (in AMD)
Regardless circumstances mentioned above, situation in banking system is favorable. In 2008 banks' profits comprised AMD 27 billion, and, as no dram devaluation is expected in nearest future, no further losses are expected.
According to CBA Chairman, banking system was in highly unfavorable situation, as banks were in short foreign currency position, where the bank's foreign currency liabilities exceed its actives.
The reason for such position were expectations formed within 3 months (Dec 2008-Mar 2009) towards foreign currency revaluation and national currency devaluation.
Guided by these expectations, many investors withdrew their dram investments, investing dollars instead. In current circumstances, by the end of 2008 the ratio of dram investments to dollar investments comprised 65% to 35%. Upon CBA selling a certain amount of dollars, the ratio changed in favor of dollar investments, comprising 70%(in dollars) and 30% (in AMD)
Regardless circumstances mentioned above, situation in banking system is favorable. In 2008 banks' profits comprised AMD 27 billion, and, as no dram devaluation is expected in nearest future, no further losses are expected.
