Loans to legal entities

1.      

Currency

AMD

2.     

Borrowers

RA resident legal entities and sole proprietors:

• SMEs (the number of employees is below 250).
  Mid-cap companies (the number of employees is between 250-3000).

3.    

Economic sectors

• Production
• Tourism
• Export-oriented activity
• Manufacturing

4.    

Purpose

• Purchasing fixed assets and/or
• Replenishing current assets
• Other investments complying with the Program requirements.

5.    

Target area

• Energy efficiency
• Women in business
• Regional development
• Digitalization and automation

6.    

Limits

AMD 1,000,000 – AMD 500,000,000

7.    

Loan disbursement method

In a lump-sum and non-cash by transferring the loan amount to the Borrower’s bank account

8.    

Loan utilization method

In cash/non-cash manner

9.    

Repayment period

24 - 90 months

10.   

Grace period (optional)

Up to 30 months

11.   

Annual nominal interest rate

10.5%

12.   

Security

• A surety bond issued by a legal entity or an individual – for loans under AMD 5 million,
• Collateral – for loans  equal to or above AMD 5,000,001

13.   

Surety

RA-resident legal entity, sole proprietor or individual

14.   

Collateral

Real estate and movable property,

Cash in deposit and current accounts,

Standard gold bars or gold scrap,

 Short-term government bonds or other securities.

If necessary and available – also current assets and finished goods (with consideration of their market liquidity or Loan-to-value ratio, loan repayment period, customer’s creditworthiness, etc.).

Additional requirements: the surety bonds issued by the business founders/beneficial owners are required. Besides, as additional security the Bank may request surety bonds issued by other individuals and/or legal entities.

15.   

Acceptable level of Loan-to-value ratio

• For real property and other fixed assets – up to 70% of their appraised value.
• For short-term government bonds – up to 95% of their par value.
• For other securities – up to 70% of their appraised value.
• For standard gold bars and scrap of precious metals – up to 95% of their appraised value.
• For cash (in deposit and current accounts) – up to 90%.
• For current assets – up to 50% of their appraised value.

16.   

Insurance

On an as-needed basis  

17.     

Surety requirements

• If the surety is a legal entity – at least 6-month registered business activities.
• If the surety is an individual – stable sources of income (salary, leased out property, dividends, etc.) and/or a real property owner.

18.   

Surety's credit history requirement

If the surety is an individual:                      

• Positive credit history (for the last 12 months the total number of delayed payments should not exceed 30 days and a single delayed payment should not exceed 15 days),
• As of the inquiry date, absence of classified active loans, overdue loans and/or  surety bonds and/or assets worth more than AMD 100,000 that have been arrested by the RA Compulsory Enforcement Service (if the arrested assets are worth more than AMD 100,000, the customer may submit documents supporting their relevant payments).

If the surety is a legal entity:

• Positive credit history (for the last 12 months the total number of delayed payments should not exceed 30 days and a single delayed payment should not exceed 15 days),
• The revenue reported in the tax return for the last 6 months must be above AMD 100,000,
• As of the inquiry date, absence of classified active loans, overdue loans and/or  surety bonds and/or assets worth more than AMD 100,000 that have been arrested by the RA Compulsory Enforcement Service (if the arrested assets are worth more than AMD 100,000, the customer may submit documents supporting their relevant payments).

19.   

Fee for early repayment *

If prior to the end of the first half of the loan term, the monthly payable principal exceeds the amount under the repayment schedule, the Bank will charge a fee at 5% of the excessive prepaid amount.

In individual cases, the size of the penalty may be changed based on the decision of a competent body of the Bank.

20.     

Fees charged

• Loan application review fee – 0
• Fee for credit account service  – at 0.5% of the loan amount, but no less than AMD 20,000, and no more than AMD 50,000.
• If the loan is disbursed in cash – a fee for cash withdrawal from the bank account, according to the Bank's fees and rates.

21.   

Penalty for late payment of the principal and interest amounts

For each day the credit liabilities are past due the Bank can charge a penalty starting the first day of delay.

• For past due principal amount - 0.015% per day,
• For past due interest - 0.1% per day.

22.  

State duties and other charges

• State duties payable to RA state competent bodies for registration and ratification of collateral agreement.
• Fee for appraisal of pledged assets: according to the fees set by a Bank partner - independent appraisal entity.

23.    

Other provisions

• Under the Program, the Bank will not refinance any existing loans.
• Loan applications will not be approved unless they meet the Program requirements.

24.   

The Bank will charge a fee for prepayment of the loan principal if the contractual amount of the loan exceeds AMD 5, 000 000.