By Atom Markarian
The owners of Credit Yerevan gathered Monday to discuss the future of one of Armenia’s largest banks teetering on the brink of collapse.
The bank was placed last month under a temporary management of the Armenian Central Bank (HKB) after it began to default on its liabilities. Scores of concerned depositors flocked to its head office in Yerevan, demanding their money back.
The new HKB-appointed administration has imposed a $500 limit on cash withdrawals by a single client pending the implementation of its “financial adjustment” program. Its details were discussed by top shareholders and executives of Markos Group Armenia, a business conglomerate of which Credit Yerevan is a member.
Making up the group are 17 privately owned enterprises. Most of them are involved in the manufacturing of machines, chemicals, construction materials and electronics parts. The group also encompasses trading companies and the Mercedes luxury car dealership in Yerevan.
Markos Group is in turn part of the Russian umbrella structure, Markos Group Holdings. Its largest shareholder is Levon Hayrapetian, an Armenian-born millionaire businessman.
With details of the discussions on Credit Yerevan kept under wraps, it was not clear what the shareholders plan to do with the troubled bank. The Markos Group chief executive in Armenia, Ivan Semyonov, told reporters that they believe it is still possible to save the bank, whose net assets exceed 17.5 billion drams ($31.4 million), from ruin.
Many of its Credit Yerevan’s estimated 8,000 depositors blame the bank’s woes on its former owner, parliament deputy Martin Hovannisian. Hovannisian has not yet responded to the accusations.
The Markos Group leaders also discussed operations of the other Armenian subsidiaries. Journalists were allowed to be present at that part of the meeting. Valentina Litvienko, vice-president of the group’s parent company, criticized their managers for what she said is worse-than-expected performance and failure to come up with new business strategies. But she said all 17 firms have skilled personnel and are well placed to attract Russian investments.