Financial Crime World

Armenia’s Financial Sector Relies Heavily on Compliance Officers

In Armenia, compliance officers play a vital role in maintaining the stability of the financial sector. With the banking sector accounting for approximately 92 percent of the country’s assets, it is essential that these professionals are up to date with the latest regulations and laws.

The Armenian Banking Sector

As of 2012, the Armenian banking market was comprised of 22 commercial banks, with 442 branch offices. The collective equity of these banks totaled AMD 366 billion ($897 million USD), while total assets reached AMD 2.2 trillion ($5.4 billion USD). Compliance officers are responsible for ensuring that these institutions operate in accordance with regulatory requirements.

The Armenian Securities Market

The Armenian securities market is also subject to strict regulations, with two self-regulating organizations (SROs) overseeing foreign currency and securities trading. The Central Depository, a member of the NASDAQ OMX group, is responsible for processing and clearing payment instruments and documents.

Non-Bank Financial Institutions

In addition to banking and securities institutions, Armenia has:

  • 32 non-bank financial institutions
  • 9 insurance companies
  • 4 insurance brokerage firms
  • 236 currency exchange offices
  • 7 money transferring companies
  • 6 organizations dealing with processing and clearing payment instruments and documents

Compliance officers are essential in ensuring that these entities comply with relevant laws and regulations.

Foreign Currency Operations

Foreign currency operations are regulated by the “Law on Currency Regulation and Currency Control,” which stipulates that prices for transactions between Armenian residents must be quoted and paid in Armenian currency. There are no conversion restrictions between Armenian and foreign currency, and foreign currency accounts may be maintained in Armenian banks.

The Central Bank of Armenia

The Central Bank of Armenia (CBA) is responsible for supervising and regulating the country’s financial market. The CBA’s primary mission is to maintain price stability, which it achieves through an inflation targeting strategy that influences domestic interest rates and addresses forecasted levels of inflation.

Compliance Officers: A Critical Role

Compliance officers play a critical role in maintaining the integrity of Armenia’s financial sector. With numerous international accounting firms operating in the country, including:

  • KPMG
  • PriceWaterhouseCoopers
  • Ernst & Young
  • Grant Thornton CJSC
  • Binder Dijker Otte & Co (BDO)

Armenia has access to high-quality professional services.

Conclusion

Armenia’s financial sector is well-positioned for growth, thanks in part to the expertise and diligence of compliance officers. As the country continues to develop its financial infrastructure, it is essential that these professionals remain up-to-date with the latest regulatory requirements and best practices.