By Shakeh Avoyan
The owner of one of Armenia’s oldest and largest banks that unexpectedly announced its self-liquidation this month claimed Friday to have been squeezed out of business by private competitors and their cronies in the country’s Central Bank (CBA).
In an interview with RFE/RL, businessman and parliament deputy Hakob Hakobian effectively confirmed media speculation that his Agrobank fell victim to unfair competition from powerful government-connected tycoons. “A lot of people noticed that we are doing well and started to compete with us by dishonest means,” he said.
Hakobian, better known to the public with his “Choyt” nickname, refused to elaborate on the allegations, promising to make more detailed “sensational” statements about Armenia’s banking sector and the CBA in particular “within the next 30 or 40 days.” He spoke just as another commercial bank took over much of Agrobank’s assets.
Founded almost 80 years ago, Agrobank had the second largest network of local branches and was used by the state treasury for handling the government’s cash payments across Armenia. In that regard, it rivaled the Armenian Savings Bank that boasts the highest number of territorial offices. Some newspapers have alleged that the latter’s owner used his extensive government connections to monopolize such services.
The Savings Bank is controlled by Mikhail Baghdasarov, a Russian-Armenian millionaire businessman whose Mika group enjoys a de facto monopoly on large-scale fuel imports to Armenia. Baghdasarov reportedly has close ties with powerful Defense Minister Serzh Sarkisian.
Analysts note that Agrobank, which has faced serious financial problems since its 2001 purchase by Hakobian, announced its closure just as it seemed to be turning the corner. Hakobian confirmed that the bank was on the mend and even made profits in the last several months. While insisting that the its dissolution was “voluntary,” he complained about “subjective decisions” allegedly taken by the CBA board and its chairman, Tigran Sarkisian.
“There are banks that operate under someone’s tutelage and have some strong patrons,” he said. “That instills more fear in the [regulatory] authorities. As a result, the Central Bank has tight regulations for some banks and weaker ones for others.”
CBA, which declined a comment, has had uneasy relations with Agrobank. Sarkisian apparently referred to the latter when he said earlier this year that one of Armenia’s 22 commercial banks is failing to meet the minimum capital requirements set by the CBA.
Meanwhile, it was announced on Friday that most of Agrobank’s 35 branches will be leased to the private Ardshininvestbank that was created last year after a dubious collapse of another major local bank. Ardshininvestbank’s chairman, Aram Andreasian, said it will buy Agrobank’s other assets and liabilities. One informed source told RFE/RL that Baghdasarov is already showing interest in the remaining Agrobank branches.
Agrobank held a total of 750 million drams ($1.3 million) worth of cash deposits from some 800 private individuals. Hakobian said all of them will get their money back without any problems.
(Photolur photo: Agrobank manager Zorik Avetikian, left, and Ardshininvest's Aram Andreasian announcing the deal to journalists.)