YEREVAN, August 25. /ARKA/. The banking sector in Armenia remains well-capitalized and highly profitable, supported by high net interest income and stable economic growth. This is stated in a report by the international rating agency S&P Global Ratings.
“The growth of lending remains high, mainly due to consumer and mortgage lending, although the tightening of macroprudential measures and the gradual phasing out of mortgage tax incentives have begun to reduce housing demand, particularly in Yerevan,” the report says.
Despite the rapid growth of lending leading to an increase in private sector debt, the agency's analysts currently consider the associated risks to be manageable. This is supported by significant capital reserves of banks, stable asset quality, and expectations of maintaining high profitability.
As a preventive measure, the Central Bank raised the countercyclical buffer by 0.25 percentage points in July. The 2.0% rate will come into effect in February 2027.
“The gradual dedollarization of banks' balances has subsequently reduced currency risks, and the increase in financing from non-residents and international financial organizations is unlikely to lead to a significant deterioration in financing conditions. The main risk for the banking sector remains high geopolitical uncertainty,” the report emphasizes.
According to the report by the ARKA agency “Indicators of the Activity of Banks in Armenia: Operational Data for Q2 2026,” compiled based on the reports of Armenian banks according to international standards, the total net profit of Armenian banks for the first half of 2026 amounted to 219.72 billion drams, an increase of 9.48%. The total assets of Armenian banks as of June 30, 2026, amounted to 13.84 trillion drams (annual growth of 19.15%), the volume of credit investments was 8.56 trillion drams (growth of 23.56%), total liabilities were 11.61 trillion drams (growth of 20.27%), and total capital amounted to 2.23 trillion drams (growth of 13.63%).
