Cenbank voices ‘positive trends’ in deposit volumes after ‘completely natural’ wartime drop
YEREVAN, DECEMBER 4, ARMENPRESS. The decrease of deposits in conditions of the COVID-19 pandemic and then also the martial law and the war in Artsakh happened in far lower volumes than forecast in times of such crises, moreover the pace of decrease of deposits slowed down significantly and positive trends are already observed, the Central Bank of Armenia told ARMENPRESS.
On October 27, when the Artsakh war was still ongoing, the cenbank chief Martin Galstyan had announced that savings of citizens and companies in the Armenian banking system had somewhat dropped, noting that however that drop constituted an insignificant percentage in the total deposits.
In response to an inquiry on the trends of recoveries, the cenbank told ARMENPRESS that the existing uncertainties in the economy, as a rule, inevitable bring about unfavorable impacts on the financial system, and that the martial law brought new challenges in times when the pandemic’s impact wasn’t yet overcome.
The existing situation and the uncertainty naturally impact the behavior of citizens, and the somewhat drop of deposit volumes was found to be “completely natural” by the cenbank.
“Nevertheless, the decrease of deposit volumes is far smaller than expected in times of such deep crises. The behavior displayed by the society both in the initial period of the pandemic as well as since the beginning of the war is a testament to the high trust people have for the financial system. We can state that now the paces of decrease of deposits have slowed down, moreover, positive trends already exist,” the Central Bank said.
Also, the current level of capitals and liquidity of banks gives grounds for the cenbank to conclude that the system will continue functioning normally in the current situation.
Reporting by Anna Grigoryan; Editing and Translating by Stepan Kocharyan