YEREVAN. – The banking system of Armenia remains sustainable and possesses enough liquidity, Mr Andranik Grigoryan, head of Financial System Stability and Development Department of the Central Bank of Armenia said at the media conference on Tuesday.

The minimum required threshold of the capital adequacy ratio in Armenia is 12%, compared to 8% set by the Basel committee. Instead, the average performance of the banks in Armenia for 2014 has been 14-15%. This goes to show that their risks are completely manageable, Grigoryan underscored.

In the last few years Capital Adequacy Ratio (CAR) has somewhat decreased, but only for technical reasons: according to the methodology of calculations, larger loan portfolio factors in for a lower CAR. Accordingly, since 2008, the financial system of the country saw credit growth by a rough yearly average of 20%. 

Still, both formally and essentially, banks still comply with CAR requirement and are able to absorb any possible risks, CB official added.