YEREVAN. – The new pension reform will definitely have a positive impact on Armenia's banking sector, said Samvel Chzmachyan, chairman of the Union of Banks of Armenia.

“The impact that reform will have on the financial market of Armenia will be useful for banks,” he told reporters on Thursday.

In particular, the reform will have an impact on the overall market, since the direct income of depository banks is not that significant.

He said the Armenian banks continue to perform depositary functions on pension accounts.

“As you know the law on pensions is still in force. The Constitutional Court temporarily suspended only two points, not the most important ones,” he added.

The new funded pension plan, which formally came into force in Armenia on January 1, 2014, is mandatory for those born in and after 1974 and voluntary for those born before 1974. In line with this plan, 5 to 10 percent of the monthly salaries in Armenia will be deducted and mandatorily be allocated to cumulative pension funds; the latter will be reimbursed as pensions once a person turns 63 years old.