Turbulence in the Securities Market: Who and What Were Behind It?

In December, unusually high activity was observed in Armenia’s securities market. For the first time in the local financial market, perpetual bonds were offered, creating real excitement among investors. Within minutes of Unibank’s announcement of this new instrument, it became clear that demand significantly exceeded supply.

“Each of our three perpetual bond issues was placed within just a few days, far exceeding our expectations. In total, we placed AMD 6.5 billion and USD 9 million worth of perpetual bonds. However, given the high demand and strong market excitement, many clients simply did not manage to participate in the placement and take advantage of this opportunity. Therefore, to meet the existing demand, we expect another issuance of perpetual bonds in the second half of 2026,” said Mesrop Hakobyan, Chairman of the Management Board of Unibank.

He emphasized that this was the first time perpetual bonds had been issued in Armenia, and their rapid sale clearly demonstrates the public’s strong interest in new long-term investment instruments, as well as the high level of trust in Unibank.

The yield of perpetual bonds significantly exceeds that of traditional bonds, making them especially attractive to investors seeking long-term returns. The coupon is 3.75% per annum for the AMD-denominated bonds and 8.3% per annum for the USD-denominated bonds. Interest payments will remain fixed for the first three years. After that, for dram-denominated bonds, the rate will be calculated based on the government bond yield curve, and for dollar-denominated bonds, based on the SOFR rate. After the fifth year, the bank may exercise its call option and redeem the bonds at their nominal value. 

“The moment had long arrived for perpetual bonds to exist in our market. Over the past few years, this topic was actively discussed, and it is no coincidence that after the Central Bank introduced the necessary regulations, the market responded quickly. Today, we have the first successful issuance and placement of such bonds. This is another positive signal that Armenia’s financial market has transformed and is now more ready than ever for new and faster stages of development,” said Karen Zakaryan, Executive Director of FINARM, the Association of Financial Market Participants.

According to him, this type of bond represents a shift in mindset. Without being limited by a fixed maturity, investors increasingly rely on market liquidity, which is especially important for this type of security.

Market activity has indeed reached a new qualitative level in recent years, including through the expansion of the investor base. Although the market’s full potential, particularly regarding the total number of investors and individuals with investment accounts, has not yet been fully realized, it is clear that attractive offerings are met with rapid market response. Already, there is a prepared, informed, and long-term-oriented group of investors. Interest in perpetual bonds was shown not only by individual investors but also by investment funds.

“First, credit should be given to Unibank for entering the market with a very attractive offer, and the market responded accordingly. This instrument was expected, and Unibank’s proposal was highly compelling, which is why the results followed quickly. Unibank has a distinct record of accomplishment in our financial market and a stable, loyal client base. At the same time, investor confidence in our market has grown noticeably in recent years. The successful sale of Unibank’s perpetual bonds is a clear example of the successful combination of these factors,” said Karen Zakaryan.

As one of the most active and leading participants in the stock exchange, Unibank has successfully placed 29 bond issues to date. The new investment instrument, perpetual bonds, provides the opportunity to earn predictable and regular income over the long term.

 “Our vision has always been to develop the local financial market and create an environment where people can invest freely. Unibank is successfully fulfilling this challenging mission by opening new opportunities for Armenian investors. We are happy to be part of this change and to continue the responsible work that has already begun,” said Ararat Mkrtchyan, Founder and CEO of Sirius Capital Investment Company, the market maker for the ISIN AMUNIBB2UER0 and ISIN AMUNIBBM1ER9 issues.

“In many respects, Unibank’s position as a market pioneer is largely driven by the vision of its main shareholders and the management’s ability to act in line with that vision. Unibank was among the first banks to list its shares on the stock exchange, the first to issue subordinated bonds, and now the first to make a public offering of perpetual bonds. The willingness to try new things is the most important and fundamental characteristic for achieving success in today’s business environment, and Unibank’s journey is vivid proof of that,” emphasized Karen Zakaryan.