Project detail - Armenian Economy Development Bank OJSC

Who is our prospective customer?

Armeconombank OJSC (“AEB”) is a top-10 Armenian mid-sized universal bank with a focus on micro-, small-, and medium-sized enterprises (MSME) and retail. AEB reports total assets of ~USD 1.5 billion, Equity of USD 510 million, and return on equity amounting to 12.7% as of Q2 2025. With over 900 staff members, the bank operates a top-5 branch network with 54 branches in the country. FMO has partnered with AEB previously during 2010-2013, and reinforced this partnership by providing senior loans in 2019, 2020, and 2024, totaling more than USD 65 million. The key shareholders are members of the Sukiasyan family, who own the bank for 51.5%, and the remainder is widely spread.

What is our funding objective?

AEB will utilize 90% of the new USD 30 million FMO loan to finance eligible Reducing Inequalities initiatives, including support for Microenterprises, Youth, Women, and Agricultural SMEs. The remaining 10% will be allocated to Green projects that meet FMO’s Master Green List criteria.

Why do we want to fund this investment?

Armenia remains a lower-middle-income country (LMIC), as a material part of its population (42.5%) lives below the poverty line. Despite the significant presence of MSMEs, their contribution is only about 25% of GDP and 19% of employment, with limited access to credit. MSMEs are therefore fundamental to the overall socio-economic development of the country. In addition, Armenia’s heavy reliance on energy imports and outdated infrastructure makes sustainable energy development crucial, with renewable sources like solar, wind, and hydropower offering potential solutions. Green loans are vital for funding these renewable energy projects and modernizing infrastructure, driving both environmental and economic benefits while reducing dependency on fossil fuels. FMO’s financing will hence be used by Armeconombank to support both Green projects and loans to MSMEs, Agri, Youth, and Women.

What is the Environmental and Social categorization rationale?

The project has E&S category B in accordance with FMO’s Sustainability Policy. AEB has an Environmental and Social Management System (ESMS) in place, which is based on IFC and EBRD's guidance and criteria. Despite Corporate and Project Finance loans being higher than 10% of the bank’s total loan portfolio, it remains well below the USD 300mln threshold. In addition, the bank’s exposure to high E&S risk sectors is well below the threshold of 20%. Given the presence of such transactions in the portfolio, AEB’s E&S risk categorization is set at B as the bank remains primarily MSME-focused. As part of the project, the bank will be required to apply the EDFI Exclusion List and local E&S laws and regulations.

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