Ararat Bank

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Translated version of this PSD: Armenian The EBRD is considering subscription to newly issued ordinary voting shares of OJSC Araratbank (AB) of approximately 250 million Armenian drams (US$ 650k equivalent) as part of Araratbank’s capital increase of 1,000 million drams (US$ 2.6 million equivalent). As a result of the capital increase, Araratbank ("AB") will become a more effective competitor in the local market through implementing its growth strategy. In the longer term, Araratbank will present itself as a good platform for further development by a strategic investor thus further intensifying the overall competitive structure of the Armenian banking sector. The proposed project supports the development of Araratbank to enable it to expand its customer base through increased financial services to the MSME sector. In addition, the capital raising will provide AMD 1 billion of local currency lending, which will assist Araratbank to improve their local currency/ foreign currency asset/liability management. Open Joint Stock Company Araratbank, a privately owned commercial bank operating in Armenia. The bank provides a wide range of banking services to corporate, MSME and retail customers. Ararat Bank is focussed on micro, small and medium-sized companies as its main clientele, with individuals being the second largest client group. Subscription to newly issued ordinary voting shares of approximately 250 million drams (AMD). AMD 250 million. Categorised FI. Araratbank has adopted and is implementing environmental and social due diligence and monitoring procedures, and complies with the Bank's Environmental Social and Exclusion and Referral List. Araratbank's policies and procedures are generally compliant with the requirements of EBRD's Performance Requirement 2 and 9. Some recommendations for additional improvement have been formalised in an action plan and agreed with Araratbank. Previous technical assistance included Institutional Building Programme which linked the Bank’s equity investment in the institution. The technical cooperation was designed to assist the bank in developing its policies and procedures, strategic planning, review of IT and recommendations on improvements, assistance in design of the marketing strategy among other objectives. Donor funding was provided by the EBRD Early Transition Countries (ETC) Fund and the EBRD’s Shareholder Special Fund (SSF). In addition, technical assistance was provided to Araratbank under the Armenia Micro-lending Programme. The assistance was designed to expand programme’s institution-building to ensure increased lending to MSMEs and improved skills and knowledge within the banking sector. Donor funding was provided by USAID, the EBRD Early Transition Countries (ETC) Fund and the EBRD’s Shareholder Special Fund (SSF). Mr Davit Harutyunyan, Deputy CEO, Araratbank OJSC, 19 Pushkin street, Yerevan, Republic of Armenia. Telephone: +374 10 547962 Fax: +374 10 547894 E-mail: araratbank@araratbank.am