Information on interest rates

1. Annual simple interest is an annual interest rate set by the deposit agreement, on the basis of which the bank calculates the interest to be paid to the depositor.

The formula for calculating the interests paid under this type of deposit agreement: 
DA * I / 365 * Days – 10% (income tax), where
DA – deposit amount placed
I –annual simple interest rate
Days  – number of days for which the deposit is placed, taking into account RA Civil Code article 907, paragraph 1 which defines that interest on the deposit amount is not calculated for the days of return to the depositor or withdrawal from the depositor's account for other grounds. 

Example 1

Term of the deposit - 365 days
Principal amount of the deposit - 100 000  AMD
Annual simple interest rate - 9.5 %
100 000 *9.5 /100 / 365 * 364 -10% = 8 526.6  AMD

2. Annual percentage yield (APY) shows how much the annual interest rate of the deposit will be as a result of the customer making mandatory payments related to the deposit and adding the received interest to the principal amount (compounding).

, where

A - Principal amount of the deposit,
n- next cash flow number for the deposits
N- is the last number of the cash flow for the deposits (including the cash flow at the time of making the deposit), after which the term of the deposit contract is considered completed
K_n - Flows of the deposit and/or compound interests, as well as mandatory payment flows (if any) at the time of making the deposit and/or during its validity.
D_n –shows the number of days passed from the day of making the deposit until the next (n^th) cash flows for the deposit, included. In case the cash flow coincides with making the deposit- D ₁=0:
APY is the annual percentage yield.

• Let’s suppose a deposit with the following conditions is offered:

a. Deposit amount: 100 000  AMD
b. Term of the deposit: 1 year (365 days)
c. Annual simple interest: 9.5 %
d. Interest payments at the end of the deposit term
e. Mandatory payments made by the depositor on the day of getting the deposit:

The interest paid at the end of the deposit agreement is:

100 000 * 0.095-10%=8 550 AMD
n=1
D=365
K= 108 550

3. Possible calculation of annual interest rate on deposits in case of regular frequency of interest payments

APY= (1+r/n)ⁿ- 1, where
APY is the annual percentage yield
r-annual simple interest rate 
n- number of compounding periods per year

If the frequency of making interest payments equals to n =1 at the end of the term, then  

APY= (1+0.095/1)¹ -1,
APY=0.095*100=9.5% 

Information on protection of the depositor’s rights

All the disputes or disagreement arising during the account maintenance or deposit activity period are settled by the mutual consent of the two parties. In case of a failure to reach an agreement, the depositor’s rights are protected in a legal form, as well as through the financial system mediator. The depositor can protect their rights either personally or through an authorized representative.

The Bank is not entitled to condition the conclusion of a deposit agreement by the conclusion of an arbitration one.

Additional information

1. The necessary documents for making deposits are:

• passport or identity document,
• public service number or reference on refusing it.

2 The interest on the time deposit amount is accrued from the day the Bank receives the deposit until the day before it is returned to the depositor or written off from the Depositor's deposit account on other grounds. Interests are accrued on a daily basis. In accordance with the law “On currency regulation and currency control” Article 6, point 2 interest payments on financial operations are made in drams of the Republic of Armenia. If the deposit is made in a foreign currency, the interest is paid at the settlement rate set by the CBA on the day of payment.

3. Interest accrued to the deposit is subject to taxation (income tax) at the rate of 10%, according to the legislation of RA. The depositor is paid the amount after taxes.

4. If the deposit maturity term coincides with a holiday and/or weekends, the term is the next working day.

5. The deposits placed in the Bank are guaranteed by the Individuals’ Deposit Guarantee Fund, in accordance with the legislation of RA. The guaranteed deposit limits are as follows:

a) In case of only an AMD deposit- 16 million AMD, instead of the previous 10 million AMD.

b) In case of only a foreign currency deposit – 7 million AMD, instead of the previous 5 million AMD.

c) if you have both an AMD and foreign deposits in an insolvent bank, and the sum of the AMD deposit is over 7 million AMD, only that deposit is guaranteed for up to 16 million Armenian drams.

d) if you have both an AMD and foreign deposits in an insolvent bank and the sum of the AMD deposit is less than 7 million AMD, the deposit in AMD is fully guaranteed, while the deposit in a foreign currency is guaranteed at the amount of 7 million AMD and reimbursed dram-denominated bank deposit.

6. You can get further information by calling the hotline at (+37410) 59 55 55.

«For the purpose of proper examination of the client defined by the RA law “On Combating Money Laundering and Terrorist Financing", the consumer may be requested to submit additional documents or other information, as well as be asked additional questions during oral communication, based on the “Know your customer” principle.


Տեղեկատու կենտրոն` +37410 59 55 55

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