World Bank Notes Stable Growth in Armenia’s Banking Sector with a Capital Adequacy Ratio of 20.3%

Armenia’s banking sector is experiencing stable growth in key indicators, with particular momentum seen in funds denominated in the national currency. According to the World Bank’s new report on the country’s economic development, August saw an increase in both deposits and loans.

According to the international financial institution, deposits in commercial banks rose by 0.3% in August compared to the previous month, while the loan portfolio grew by 3%. On an annual basis, with exchange rate adjustments, deposits increased by 9.9%, while loans grew by 19.9%. This led to an increase in the loans-to-deposits ratio from 0.89% at the end of August 2023 to 0.93% by the end of August 2024, although the ratio remains below one.

Particular attention is drawn to the financial stability of the banking sector. The capital adequacy ratio remained steady at 20.3%, unchanged since July. Additionally, the share of non-performing loans remains low at 1.3%, while the return on assets reached 4.6%, with both indicators improving by 0.1 percentage points compared to July.

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